Leonard Company began operations late in 2024 and adopted the conventional retail inventory method. Because there was no beginning inventory for 2024 and no markdowns during 2024, the ending inventory for 2024 was $14,000 under both the conventional retail method and the LIFO retail method. At the end of 2025, management wants to compare the results of applying the conventional and LIFO retail methods. There was no change in the price level during 2025. The following data are available for computations.

Instructions

Compute the cost of the 2025 ending inventory under both 

(a) The conventional retail method 

(b) The LIFO retail method.

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Inventory, January 1, 2025 Sales revenue Net markups Net markdowns Purchases Freight-in Estimated theft Cost $14,000 58,800 7,500 Retail $20,000 80,000 9,000 1,600 81,000 2,000