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  • On November 21 2016 A Flood at Hodge Company S Warehouse

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    A flood occurred at Hodge Company's warehouse on November 21, 2016, damaging their entire inventory of Product Tex. Hodge estimates the salvage value of the damaged goods is $10,000. Their accounting records show they had $100,000 of Product Tex inventory on November 1, $140,000 in purchases until the flood, and $220,000 in net sales. Using a 30% gross profit margin, Hodge can calculate the estimated loss on the inventory from the flood.

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    On November 21 2016 a Flood at Hodge Company s Warehouse

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    A flood occurred at Hodge Company's warehouse on November 21, 2016, damaging their entire inventory of Product Tex. Hodge estimates the salvage value of the damaged goods is $10,000. Their accounting records show they had $100,000 of Product Tex inventory on November 1, $140,000 in purchases until the flood, and $220,000 in net sales. Using a 30% gross profit margin, Hodge can calculate the estimated loss on the inventory from the flood.

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    © All Rights Reserved
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    7 views1 page

    On November 21 2016 A Flood at Hodge Company S Warehouse

    Uploaded by

    Let's Talk With Hassan
    A flood occurred at Hodge Company's warehouse on November 21, 2016, damaging their entire inventory of Product Tex. Hodge estimates the salvage value of the damaged goods is $10,000. Their accounting records show they had $100,000 of Product Tex inventory on November 1, $140,000 in purchases until the flood, and $220,000 in net sales. Using a 30% gross profit margin, Hodge can calculate the estimated loss on the inventory from the flood.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    On November 21 2016 a flood at Hodge Company s

    warehouse #2478
    On November 21, 2016, a flood at Hodge Company's warehouse caused severe damage to its
    entire inventory' of Product Tex. Hodge estimates that all usable damaged AICPA goods can be
    sold for $10,000. The following information was available from Hodge's accounting records for
    Adapted Product Tex:Inventory at November 1,2016............. $100,000Purchases from
    November 1,2016, to dale of flood..... 140.000Net sales from November 1,2016, to dale of
    flood...... 220,000Based on recent history', Hodge had a gross margin (profit) on Product Tex of
    30% of net sales.Required:1. Prepare a schedule to calculate the estimated loss on the
    inventory' in the flood, using the gross profit method. Show supporting computations in good
    form.2. Next Level Describe situations in which the gross profit method may not provide an
    accurate estimate of ending inventory.View Solution:
    On November 21 2016 a flood at Hodge Company s warehouse

    ANSWER
    http://paperinstant.com/downloads/on-november-21-2016-a-flood-at-hodge-company-s-
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