Question - So. California Inc., through no fault of its own, lost an entire plant due to an earthquake on May 1, 2011. In preparing their insurance claim on the inventory loss, they developed the following data: inventory January 1, 2011, $300,000; sales and purchases from January 1, 2011 to May 1, 2011, $1,300,000 and $875,000, respectively. So. California consistently reports a 40% gross profit. The estimated inventory on May 1, 2011 is:
$302,500.
$360,000.
$395,000.
$455,000.