Jefferson Company has sales of $300,000 and cost of goods available for sale of $270,000.If the gross profit ratio is typically 30%,the estimated cost of the ending inventory under the gross profit method would be:

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Gross profit = Sales × Gross profit ratio= $300,000 × 30%= $90,000Cost of goods sold = Cost of goods available for sale – Ending inventory$270,000 – Ending inventory = $90,000Ending inventory = $270,000 – $90,000= $180,000

Jefferson Company Has Sales of $300,000 and Cost of Goods