Estimating with Gross Profit - Acct 2331, The University of Houston

in Chapter 6 (Video 10 of 10)

7 minutes

The Gross Profit Method is a way to estimate what our Cost of Goods Sold is, without having to do a physical inventory count.

This Video Mentioned Some Formulas

Profit Margin = Net Income / Sales Revenue

Sales

– COGS

Gross Profit

Gross Profit Margin = Gross Profit / Sales Revenue

Gross Profit Ratio is the same as Gross Profit Margin

Beginning Inventory

+ Net Purchases

– COGS

Ending Inventory

1	COGS and Inventory	2:57
2	Perpetual vs Periodic	7:10
3	FOB Shipping?	8:51
4	Transportation In	8:41
5	COGS	6:18
6	Specific Identification	2:17
7	Weighted Average	4:21
8	FIFO and LIFO	20:17
9	Gross Profit vs Net Profit	6:15
10	Estimating with Gross Profit You are here.	7:23

	Click Here to View All Chapter 6 Problems at Once	View
1	Consignment Inventory	Easy
2	FOB Destination	Easy
3	Inventory Set Aside	Easy
4	Loss On Inventory	Easy
5	FOB Shipping	Moderate
6	FOB Shipping	Moderate
7	Inventory Costing	Moderate
8	The Effect of Inventory Errors	Hard