I needs help with that pls Financial Accoanting Turck) (9SupEx(ventory docs esca
ID: 2571754 • Letter: I
Question
I needs help with that pls
Financial Accoanting Turck) (9SupEx(ventory docs escaped from for miking sundaes. On November 17, 2016, a pack of wild people resulting in aoadaction spa broke isto one section of the warehouse and ae all the toppings insurance companyall toppings stored its that section. Ramirez Dist. Inc, must provide its vailable from the company's accounting CI) GROSS PROFIT PERCENTAGE MET hops with various Calculate the estimated cost of each of the tappings lost in, the melee your work) CkFig Fruit Toppings l0t-$10,000, Regnired: c kd oupngs Historical gross profit rato 35% 30% inventory, January 1, 2016 Net purchases through Now 17 s 20,000 150,000 5 3,000 6,000 20.000 rrins-lamesjie ze i Mark-ap on Cost %. Doe't make the mistake of thinking Mark-up o Cost % i-equi st to the Gross Profit%. Accountants like to use the Gross Profit %, while non-accountant business people may prefer to use Markup on Cost %, L kily, with the simple formula identified as D below Mark up on st % is eksily converted to Gross Pront%. An example to further in strate the difference between Mark-up on Cost % versus Gross Print % is provided text. when i pay S60 tor a skateboard that l plan to resell, I need to determine the price tag value. I always add 50% of the cost (S30) to the cost and that is my selling price. I will sell the i Mark up on Cost, what "Gross Profit %_ is implied by a 50 % Markup on Cost? Hint: Imagine the Income Statement assuming I sell that one skateboard. skateboard for S90. I employ a 50% Income Statement Income Statement for one skateboard sold Net Sales Rev CoGS Gross Profit0 sg - 30|- |Net Sales% 100 % | Gross Profit%-33% Net Sales ahways@ 100% 1(-530i s90 Formula for converting “Markup on Cost %" to "Gross Profit %". Markup on Cost% /(100% + Markup on Cost%)-Gross Profit%Explanation / Answer
Estimated value of the inventory lost will be the cost of inventory as on the date of the incident.
This can be arrived at as follows.
The following equations have been used above.
Gross profit ratio = Gross profit / Net Sales
Therefore Gross profit = Net Sales / Gross profit ratio.
Cost of goods sold = Net sales - Gross profit
Ending inventory = Beginning inventory + Purchases - Cost of goods sold.
Fruit Marshmallow Chocolate Toppings Toppings Toppings Historical Gross profit ratio A 20% 30% 35% Net sales through Nov.17 B 200000 55000 20000 Gross profit (A x B ) C 40000 16500 7000 Cost of goods sold (B - C ) D 160000 38500 13000 Beginning Inventory on January 1 E 20000 7000 3000 Net purchases through Nov.17 F 150000 38000 12000 Ending inventory ( E + F - D) G 10000 6500 2000