A fire completely destroyed all the inventory of Glisan Lumber Yard on August 5, 20--. Fortunately, the accounting records were not destroyed in the fire. The following information is provided by Glisan Lumber Yard for the time period January 1 through August 5:
Beginning inventory, January 1, 20-- ........... $100,000
Net purchases, January 1 through August 5 ..... 420,000
Net sales, January 1 through August 5 ........... 732,000
Normal gross profit as a percentage of sales ........ 40%
REQUIRED
Estimate the amount of merchandise inventory destroyed in the fire on August 5 using the gross profit method.