The Steelers Company had its entire inventory destroyed when a fire swept through the company's warehouse. Fortunately, the accounting records were locked in a fireproof safe and were not damaged. The following information for the period up to the date of the fire was taken from the accounting records:
sales - 486,000
purchases - 295,000
beginning inventory - 147,800
Purchase returns - 16,600
Freight-in - 8,200
1. Assuming that the gross profit has averaged 25 percent of selling price, what is the estimated value of the inventory destroyed in the fire? show all calculations
2. Assuming that the markup percentage on cost is 28 percent, what is the estimated value of the inventory destroyed in the fire? show all calculations.