Question 1 : An inventory taken the morning after a large theft discloses $60,000 of goods on hand as of March 12. The following additional data is available from the books:
Inventory on hand, March 1 $ 84,000
Purchases received, March 1 - 11 63,000
Sales (goods delivered to customers) 120,000
Past records indicate that sales are made at 50% above cost.
Required: Estimate the inventory of goods on hand at the close of business on March 11 by the gross profit method and determine the amount of the theft loss. Show appropriate titles for all amounts in your presentation.
Question 2 : Pinkel Company uses the LCNRV method, on an individual-item basis, in pricing its inventory items. The inventory at December 31, 2011, consists of products D and E, Relavant per-unit data for these products appear below.
Item Item
D E
Estimated selling price €180 €165
Cost 110 120
Cost to complete 45 45
Selling costs 15 27