The records for the Clothing Department of Dannys Discount Store are summarized below for the month of
Question:
The records for the Clothing Department of Danny’s Discount Store are summarized below for the month of January.
Inventory, January 1: at retail $25,000; at cost $17,000
Purchases in January: at retail $137,000; at cost $82,500
Freight in: $7,000
Purchase returns: at retail $3,000; at cost $2,300
Transfers in from suburban branch: at retail $13,000; at cost $9,200
Net markups: $8,000
Net markdowns: $4,000
Inventory losses due to normal breakage and so on: at retail $400
Sales revenue at retail: $95,000
Sales returns: $2,400
Instructions
a. Calculate the inventory for this department as at January 31, at retail prices.
b. Calculate the ending inventory at cost using the retail method. Round the cost-to-retail ratio to two decimal places.
Ending InventoryThe ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
Step by Step Answer:
a Cost Retail Beginning inventory 17000 25000 Purchases 82500 137000 Freight in 7000 Pur...View the full answer
Intermediate Accounting Volume 1
ISBN: 978-1119496496
12th Canadian edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy
