Exhibit 8-2The Dormer Company uses the gross profit method to estimate its inventory in interim financial statements. The markup on cost is 50%. The following information is available:
January 1, 2016, inventory balance$12,500
Purchases25,000
Sales during January24,000
?
?
Refer to Exhibit 8-2. The estimated inventory at January 31, 2016, is
A. $25,500
B. $21,500
C. $16,000
D. $12,000
Answer: B
Business
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