Sales (net) $1,450,000
Estimated gross profit rate 42%
Beginning merchandise inventory $ 100,000
Purchases (net) 860,000
Merchandise available for sale $ 960,000
Answer:
Merchandise available for sale………………………………………………… $960,000
Less cost of merchandise sold [$1,450,000 × (100% – 42%)]……………… 841,000
Estimated ending merchandise inventory…………………………………… $119,000