Business
On June 30, 20X1, a tornado damaged Jensen Corporations warehouse and factory, completely destroying the work-in-process inventory. Neither the raw materials nor finished goods inventories were damaged. A physical inventory taken after the tornado revealed the following valuations: Raw materials $87,000 Work-in-process 0 Finished goods 151,000 $238,000 The inventory of January 1, 20X1, consisted of the following: Raw materials $41,000 Work-in-process 128,000 Finished goods 173,000 $342,000 A review of the books and records disclosed that the gross profit margin historically approximated 28% of sales. The sales total for the first six months of 20X1 was $405,000. Raw material purchases totaled $150,000. Direct labor costs for this period were $112,000, and manufacturing overhead has historically been applied at 50% of direct labor. Required: Compute the value of the work-in-process inventory lost at June 30, 20X1.