Question

In: Accounting

Noa Corporations uses the retail inventory method to estimate its ending inventory. The following information relates...

Noa Corporations uses the retail inventory method to estimate its ending inventory. The following information relates to Noa Corporation’s inventory at both cost and retail for the current year.

Description

Cost

Retail

Beginning Inventory

$55,000

$78,500

Purchases

250,000

325,000

Purchase discount

10,000

Freight-In

5,000

Additional markups

24,000

Markup cancellations

7,000

Markdowns

12,000

Markdown cancellations

3,500

Sales

400,000

Instructions: Answer each of the following questions.

What is the ending inventory at retail?

If the ending inventory is to be valued at conventional retail method, the calculation of the cost to retail ratio should be based on what cost and retail?

Using the conventional retail method, calculate the approximate cost of ending inventory.

Solutions

Expert Solution

ekkarill92 answered 2 years ago
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