Gross Profit Method
on 30 April, Greenfield Sales, Inc The Gross Profit of Greenfield Sales, Inc

Gross profit method
On 30 April, Greenfield Sales, Inc. lost its entire inventory in a flood. The following information is available from the company's accounting records, which were recovered from the waterproof safe:
$\begin{array}{|l|l|}\hline \text { Inventory, 1 January } & \$ 325,000 \\\hline \text { Purchases, 1 January through 30 April } & \$ 675,000 \\\hline \text { Net sales, 1 January through 30 April } & \$ 975,000 \\\hline\end{array}$ The gross profit of Greenfield Sales, Inc. over the past several years has consistently averaged 35% of net sales. Using the gross profit method, estimate the cost of the inventory lost in the flood on 30 April.