Valuing Inventory Using Average Cost Retail Method Dean Company uses the retail inventory method to estimate its inventory for interim statement disclosures. Data relating to the computation of the inventory at July 31, 2020, follow. Compute estimated inventory on July 31, 2020, using the average cost retail method. Round any cost ratios used in your calculations to two digits after the decimal; for example, use 0.42 for 0.424 or 0.43 for 0.425. Cost Retail Beginning inventory, February 1, 2020 $108,000 $150,000 Purchases 612,000 945,000 Markups, net 105,000 Sales 1,035,000 Markdowns, net 75,000 Ending Inventory at cost 0