1.For the items listed below indicate Add or subtract if the would appear as an indication or subtraction to inventory at cost or inventory at retails using the retail inventory method. If an item applies to both inventory at cost and inventory at retail, place appropriate indication for both and if an item would not appear in either put not Applicable. Assume that purchases are at gross amount and sellsrecorded net of all discounts including employee discounts.

inventory at costinventory at retail

a)Purchase returns( Does it increase or decrease inventory at cost and inventory at retail?)

b)Normal spoilage( Does it increase or decrease inventory at cost and inventory at retail?)

c)Abnormal spoilage( Does it increase or decrease inventory at cost and inventory at retail?)

d)Freight charges( Does it increase or decrease inventory at cost and inventory at retail?)

e) Employee discounts( Does it increase or decrease inventory at cost and inventory at retail?)