Respuesta :
$510,000 and had sales of $1,500,000. Assuming the rate of gross profit to selling price is 40%, $1,530,000 is the approximate value of the inventory that was destroyed.
Give a brief account on inventory.
Both the raw materials required for production and the final goods that are put up for sale are included in inventory. One of the most important assets a company can have is inventory turnover because it is one of the primary ways to generate revenue and, subsequently, earnings for the firm's shareholders. The three types of inventory include raw materials, items that are still being worked on, and finished things. It appears as a current asset on a company's balance sheet.
Three methods can be used to value inventory. These strategies include:
- The first-in, first-out (FIFO) technique states that the cost of items sold is determined by the price of the earliest materials that were purchased. On the other hand, the cost of the most recent purchases of materials is used to determine the carrying cost of the remaining inventory.
- The cost of the most recent purchases is used to determine the cost of goods sold, while the most recent purchases are used to determine the value of the remaining inventory, according to the last-in, first-out (LIFO) method.
- the weighted average technique, which necessitates valuing both inventory and COGS in accordance with the typical price of all materials acquired during the relevant time period.
To know more about, inventory, visit :
https://brainly.com/question/15118949
#SPJ4
