LeMay Department Store uses the retail inventory method to estimate ending inventory for its monthly financial statements. The following data pertain to one of its largest departments for the month of March 2018:
Cost Retail Beginning inventory $ 50,000 $ 70,000 Purchases 217,000 410,000 Freight-in 10,986 Purchase returns 4,500 7,000 Net markups 6,800 Net markdowns 4,500 Normal breakage 7,000 Net sales 290,000 Employee discounts 2,800
Sales are recorded net of employee discounts.
1. Compute estimated ending inventory and cost of goods sold for March applying the conventional retail method.
Cost Retail Cost-to-Retail Ratio Beginning inventory Plus: Purchases Freight-in Less: Purchase returns Plus: Net markups Less: Net markdowns Goods available for sale Cost-to-retail percentage (conventional retail method) Less: Normal breakage Sales: Net sales Employee discounts Estimated ending inventory at retail Estimated ending inventory at cost Estimated cost of goods sold
2. Recompute the cost-to-retail percentage using the average cost method.
Recompute the cost-to-retail percentage using the average cost method. (Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34%).)
Cost-to-retail percentage
LeMay Department Store uses the retail inventory method to estimate ending inventory for its monthly financial statements. The following data pertain to one of its largest departments for the month of March 2018:
| Cost | Retail | |||
| Beginning inventory | $ | 50,000 | $ | 70,000 |
| Purchases | 217,000 | 410,000 | ||
| Freight-in | 10,986 | |||
| Purchase returns | 4,500 | 7,000 | ||
| Net markups | 6,800 | |||
| Net markdowns | 4,500 | |||
| Normal breakage | 7,000 | |||
| Net sales | 290,000 | |||
| Employee discounts | 2,800 | |||
Sales are recorded net of employee discounts.
1. Compute estimated ending inventory and cost of goods sold for March applying the conventional retail method.
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2. Recompute the cost-to-retail percentage using the average cost method.
Recompute the cost-to-retail percentage using the average cost method. (Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34%).)
|
Related questions
Duke Co. uses the retail inventory method to estimate endinginventory and cost of goods sold. Data for the year 2016 is asfollow:
| Cost | retail | |
| Beginning inventory | $140,000 | $280,000 |
| Purchases | 420,000 | 690,000 |
| Freight in | 16,000 | |
| Purchase Returns | 12,000 | 18,000 |
| Net markups | 24,000 | |
| Net markdowns | 36,000 | |
| Normal spiolage | 5,000 | |
| Sales | 700,000 | |
| Sales returns | 20,000 | |
| Employees discounts | 6,000 |
The company records sales net of employee discounts.
Required:
Estimate Duke's ending inventory and cost of goods sold for theyear using the retail inventory method and the followingapplications:
1. Average Cost
2. Conventional
3. LIFO
Duke Co. uses the retail inventory method to estimate endinginventory and cost of goods sold. Data for the year 2016 is asfollow:
| Cost | retail | |
| Beginning inventory | $140,000 | $280,000 |
| Purchases | 420,000 | 690,000 |
| Freight in | 16,000 | |
| Purchase Returns | 12,000 | 18,000 |
| Net markups | 24,000 | |
| Net markdowns | 36,000 | |
| Normal spiolage | 5,000 | |
| Sales | 700,000 | |
| Sales returns | 20,000 | |
| Employees discounts | 6,000 |
The company records sales net of employee discounts.
Required:
Estimate Duke's ending inventory and cost of goods sold for theyear using the retail inventory method and the followingapplications:
1. Average Cost
2. Conventional
3. LIFO
please answer the question completely!! and apply all of thethree methods.
