Question - Franklin Co. has experienced gross profit ratios for 2013, 2012, and 2011 of 33.00%, 30.75%, and 31.25%, respectively. On April 3, 2014, the firm's plant and all of its inventory were destroyed by a tornado.
Accounting records for 2014, which were available because they were stored in a protected vault, showed the following:
Sales from January 1 thru April 2 $ 146,760
January 1 inventory amount 63,040
Purchases of inventory from
January 1 thru April 2 118,515
Required: Calculate the amount of the insurance claim to be filed for the inventory destroyed in the tornado.