Gross profit method
Gross profit method is a method used to determine the value of the ending inventory using a predetermined gross profit rate. This method can be used to determine the value of ending inventory if a loss from fire occurs.
Definitions
According to College Accounting: A Practical Approach by Slater (13th edition),
- Gross profit method. A method used to determine the value of the ending inventory using a predetermined gross profit rate. This method can be used to determine the value of ending inventory if a loss from fire occurs.
Related concepts
- Accounting (alternatively known as accountancy) is management of financial data, information, and knowledge about financial transactions of legal entities. Accountancy tends to include bookkeeping and, depending on a particilar enterprise, may also include quatitative analysis of financial data in the bookkeeping system and/or business intelligence.
