Raleigh Department Store uses the conventional retail method for the year ended December 31, 2022. Available...
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Raleigh Department Store uses the conventional retail method for the year ended December 31, 2022. Available information follows: a. The inventory at January 1, 2022, had a retail value of $31,000 and a cost of $11,000 based on the conventional retail method. b. Transactions during 2022 were as follows: Cost Gross purchases Purchase returns $ 570,000 Retail $ 953,000 Purchase discounts 6,000 5,000 4,000 Sales 958,000 Sales returns 5,000 Employee discounts 3,000 Freight-in 20,000 Net markups Net markdowns 20,000 4,000 Sales to employees are recorded net of discounts. c. The retail value of the December 31, 2023, inventory was $48,150, the cost-to-retail percentage for 2023 under the LIFO retail method was 42%, and the appropriate price index was 107% of the January 1, 2023, price level. d. The retail value of the December 31, 2024, inventory was $43,450, the cost-to-retail percentage for 2024 under the LIFO retail method was 41%, and the appropriate price index was 110% of the January 1, 2023, price level. Required: 2. Estimate ending inventory for 2022 assuming Raleigh Department Store used the LIFO retail method. Note: Amounts to be deducted should be indicated with a minus sign. Round your cost-to-retail percentage calculation to 2 decimal places (i.e., 0.1234 should be entered as 12.34) and final answers to the nearest whole dollar. Raleigh Department Store uses the conventional retail method for the year ended December 31, 2022. Available information follows: a. The inventory at January 1, 2022, had a retail value of $31,000 and a cost of $11,000 based on the conventional retail method. b. Transactions during 2022 were as follows: Cost Gross purchases Purchase returns $ 570,000 Retail $ 953,000 Purchase discounts 6,000 5,000 4,000 Sales 958,000 Sales returns 5,000 Employee discounts 3,000 Freight-in 20,000 Net markups Net markdowns 20,000 4,000 Sales to employees are recorded net of discounts. c. The retail value of the December 31, 2023, inventory was $48,150, the cost-to-retail percentage for 2023 under the LIFO retail method was 42%, and the appropriate price index was 107% of the January 1, 2023, price level. d. The retail value of the December 31, 2024, inventory was $43,450, the cost-to-retail percentage for 2024 under the LIFO retail method was 41%, and the appropriate price index was 110% of the January 1, 2023, price level. Required: 2. Estimate ending inventory for 2022 assuming Raleigh Department Store used the LIFO retail method. Note: Amounts to be deducted should be indicated with a minus sign. Round your cost-to-retail percentage calculation to 2 decimal places (i.e., 0.1234 should be entered as 12.34) and final answers to the nearest whole dollar.
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Answer rating: 100% (QA)
To estimate the ending inventory for 2022 using the LIFO retail method we need to calculate the costtoretail percentage and apply it to the ending ret... View the full answer
Related Book For
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
Posted Date:
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