Answer:
$100,00 was destroyed by the earthquake
Explanation:
The amount of inventory damaged by the earthquake can be estimated as shown in the computation below:
Opening inventory $300,000
Purchases $160,000
Cost of goods available $460,000
Net sales $450,000
less gross profit(30%*$450,000) ($135,000)
Cost of goods sold $315,000
The difference costs of goods sold and costs of goods available for sale is the closing goods,which is $145,000 ($460,000-$315,000)
Envisaged closing inventory $145,000
actual inventory left after earthquake ($45,000)
inventory lost to earthquake $100,000
