Question
In: Accounting
Grand, Inc. is a retail clothing store that uses the "Retail" method to value inventory. The...
Grand, Inc. is a retail clothing store that uses the "Retail" method to value inventory. The following information is presented below regarding the current operations of the company:
|
Cost |
Retail |
|
| Initial Inventory |
27,000 |
45,000 |
|
Purchase |
58,000 |
116,000 |
|
Sales |
125,000 |
Determine the ending inventory valuation for the current period using the "Retail Method":
Solutions
Expert Solution
| Estimated ending inventory at cost | (36000*52.80%) | $ 19,006 |
Working:
| Particulars | Cost $ | Retail $ | Cost-to-Retail Ratio |
| Beginning inventory | $ 27,000 | $ 45,000 | |
| Gross Purchases | $ 58,000 | $ 116,000 | |
| Goods available for sale | $ 85,000 | $ 161,000 | |
| Cost-to-Retail percentage | (85000/161000) | 52.80% | |
| Less: | |||
| Gross Sales | $ (125,000) | ||
| Estimated ending inventory at retail | $ 36,000 | ||
| Estimated ending inventory at cost | (36000*52.80%) | $ 19,006 | |
ekkarill92 answered 3 years agoRelated Solutions
Retail Inventory Method Harmes Company is a clothing store that uses the retail inventory method. The...
Retail Inventory Method
Harmes Company is a clothing store that uses the retail
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$28,800
$41,500
Purchases
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Markdowns (net)
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Required:
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Retail Inventory Method Harmes Company is a clothing store that uses the retail inventory method. The...
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$29,000
$40,200
Purchases
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$
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175,000
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Cost
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Beginning
inventory
$
47,000
$
62,000
Net
purchases
10,480
32,800
Net markups
2,400
Net
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1,400
Net sales
44,000
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LeMay Department Store uses the retail inventory method to
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Cost
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Beginning inventory
$
52,000
$
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Purchases
219,000
412,000
Freight-in
19,470
Purchase returns
5,500
8,000
Net markups
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Net markdowns
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Normal breakage
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Net sales
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Employee discounts
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Date Dec. 31 Jan. 2 Jan. 6 Jan. 9 Jan. 10 Jan. 23 Jan. 30
Description Ending inventory Purchase
Sale
Purchase
Sale
Purchase
Sale
Unit Cost or Quantity Selling Price
140 $14 120 15 150 30
85 17
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2016 $138,600
2017 $157,500
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2019 $155,700
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2017 1.10 (10 percent higher prices than in 2015)
2018 1.13
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$ 29,000
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—
$ 50,000
Purchases (gross price)
140,000
190,000
Markup cancellations
—
10,000
Purchases discounts taken
3,000
—
Markdowns
—
15,000
Purchases returns
5,000
8,000
Markdown cancellations
—
3,000
Freight-in
20,000
—
Net Sales
—
190,000
Employee discounts
—
3,000
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Cost
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$
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$ 90,000
Purchases
380,000
520,000
Freight-in
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—
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17,000
Net
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20,000
Sales
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Cost
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$90,000
$180,000
Purchases
$355,000
$581,000
Freight-in
$9,000
Purchase Returns
$7,000
$11,000
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Net Markdowns
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