Using the above data, apply the retail inventory method to compute the approximate average cost (LCM) for
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Question:
Using the above data, apply the retail inventory method to compute the approximate average cost (LCM) for the ending inventory.
at cost | at retail | |
Beginning inventory | $120 | 160 |
Purchases | 240 | 340 |
Sales | 430 | -500 |
Markdowns | 60 | |
Markdown cancellations | 10 | |
Additional markups | 120 | |
Additional mark up cancellation | 20 |
1. I wonder why there are sales at cost and retail (430, -500) at the same time. I used to solve this type of quiz, but there is always sale at retail. How does sale at cost affect the ending inventory?
2. As far as I know markdown and mark up should be listed at retail line (Right line) not at cost line (left line). If thoses are listed on left line, how does it affect the ending inventory?
Expert Answer:
Cost Retail Cost to Retail Ratio Working Beginning Inventory 12000 16000 Plus Purchases 2400... View the full answer
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