Gross Profit Method. A tsunami destroyed Kyoto Company’s warehouse and all of its inventory. Kyoto’s prior-year balance sheet reported ending inventory totaling $5,097. Kyoto’s management believes...

Gross Profit Method. A tsunami destroyed Kyoto Company’s warehouse and all of its inventory. Kyoto’s prior-year balance sheet reported ending inventory totaling $5,097. Kyoto’s management believes that last year’s gross profit percentage is a good estimate of the gross profit in the current year. Kyoto’s sales last year were $48,540 and its cost of goods sold was $27,490. Before the tsunami, Kyoto’s net sales were $28,903, and Kyoto purchased $18,005 of inventory. Of the inventory purchased, $45 had not yet been delivered to Kyoto. Round percentages to one decimal place. Use the gross profit method to determine the following:

Required »

a. What is Kyoto’s historical gross profit percentage?

b. What is Kyoto’s estimated cost of goods sold?

c. What is Kyoto’s estimated gross profit?

d. What is Kyoto’s estimated ending inventory?