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Question: Teigan's Clothiers Inc., a clothing retailer of high-end ladies fashions, had their inventory destroyed in a flood. Its average gross profit percentage is 31%. The following information is available:
Beginning inventory $212,350
Purchases $620,850
Purchase returns and allowances $ 8,000
Sales $985,950
Sales Returns and Allowances $ 14,760
Required: Calculate the estimated cost of the destroyed ending inventory using the Gross Profit Method.
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