When preparing its quarterly financial statements, Pace Co. uses the gross margin method to estimate ending inventory. The following information is available for the quarter ending March 31, Year 2:Beginning inventory$110,000 Purchases$385,000 Sales$525,000 Estimated gross margin percentage 45%What is the estimated amount of inventory that is on hand on March 31, Year 2?
A. $258,750
B. $206,250
C. $288,750
D. $236,250
Answer: B
Business
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