Fuque Inc. uses the retail inventory method to estimate ending inventory for its monthly financial statements. The following data pertain to a single department for the month of October 2013.

Instructions
  (a) Using the conventional retail method, prepare a schedule computing estimated lower-of-cost or-market inventory for October 31, 2013.
  (b) A department store using the conventional retail inventory method estimates the cost of its ending inventory as $60,000. An accurate physical count reveals only $47,000 of inventory at lower-of cost-or- market. List the factors that may have caused the difference between the computed inventory and the physical count.