Question
In: Accounting
On January 1, 2021, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both...
On January 1, 2021, Pet Friendly Stores adopted the retail
inventory method. Inventory transactions at both cost and retail,
and cost indexes for 2021 and 2022 are as follows:
| 2021 | 2022 | ||||||||||||
| Cost | Retail | Cost | Retail | ||||||||||
| Beginning inventory | $ | 102,300 | $ | 165,000 | |||||||||
| Purchases | 484,000 | 715,000 | $ | 625,000 | $ | 974,000 | |||||||
| Purchase returns | 2,800 | 1,500 | 2,500 | 6,100 | |||||||||
| Freight-in | 5,000 | 8,000 | |||||||||||
| Net markups | 5,500 | 8,400 | |||||||||||
| Net markdowns | 4,000 | 6,300 | |||||||||||
| Net sales to customers | 634,000 | 660,000 | |||||||||||
| Sales to employees (net of 30% discount) | 11,900 | 11,900 | |||||||||||
| Normal spoilage | 5,200 | 4,100 | |||||||||||
| Price Index: | |||||||||||||
| January 1, 2021 | 1.00 | ||||||||||||
| December 31, 2021 | 1.25 | ||||||||||||
| December 31, 2022 | 1.25 | ||||||||||||
Required:
1. Estimate the 2021 and 2022 ending inventory and cost of
goods sold using the dollar-value LIFO retail method.
2. Estimate the 2021 ending inventory and cost of goods sold using the average cost retail method.
3. Estimate the 2021 ending inventory and cost of goods sold using the conventional retail method.
Solutions
Expert Solution
STEP 5: Working notes: Calculate the amount of Sales: Amount of sales - Not Soles to customers Lt Sales to employee =($6 34000 + $ 11,900) = ($645900 STEP 6: Calculate Employee the amount of employee discounts: discount = f sales to employee - Sales to Selling price discount employee [$ 11,900 - $ 11,9001 L 70%. = $17000 - $11,900 - $ 5100 STEP 7 step : Calculate base layer cost to retail Percentage. Base layer cost to 4 Beginning inventory at cost x loo a retail Percentage Beginning inventor at retail $102,300 x 100 $165,000 - 62% =
ekkarill92 answered 1 year agoRelated Solutions
On January 1, 2021, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both...
On January 1, 2021, Pet Friendly Stores adopted the
retail inventory method. Inventory transactions at both cost and
retail, and cost indexes for 2021 and 2022 are as
follows:
2021
2022
Cost
Retail
Cost
Retail
Beginning inventory
$
102,300
$
165,000
Purchases
484,000
715,000
$
625,000
$
974,000
Purchase
returns
2,800
1,500
2,500
6,100
Freight-in
5,000
8,000
Net markups
5,500
8,400
Net
markdowns
4,000
6,300
Net sales to
customers
634,000
660,000
Sales to
employees (net of 30% discount)
11,900
11,900...
On January 1, 2021, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both...
On January 1, 2021, Pet Friendly Stores adopted the retail
inventory method. Inventory transactions at both cost and retail,
and cost indexes for 2021 and 2022 are as follows:
2021
2022
Cost
Retail
Cost
Retail
Beginning inventory
$
128,000
$
200,000
Purchases
435,000
585,000
$
670,000
$
843,000
Purchase returns
3,200
3,750
2,900
4,125
Freight-in
5,000
6,000
Net markups
5,300
9,200
Net markdowns
4,150
6,700
Net sales to customers
400,000
696,000
Sales to employees (net of 20% discount)
16,800
16,800...
On January 1, 2018, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both...
On January 1, 2018, Pet Friendly Stores adopted the retail
inventory method. Inventory transactions at both cost and retail,
and cost indexes for 2018 and 2019 are as follows:
2018
2019
Cost
Retail
Cost
Retail
Beginning
inventory
$
162,500
$
250,000
Purchases
800,000
1,084,000
$
680,000
$
1,063,000
Purchase returns
7,000
12,150
2,000
4,300
Freight-in
12,500
2,000
Net markups
6,900
11,800
Net markdowns
4,750
8,000
Net sales to customers
950,000
722,000
Sales to employees (net of 25%
discount)
22,500
22,500...
On January 1, 2018, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both...
On January 1, 2018, Pet Friendly Stores adopted the retail
inventory method. Inventory transactions at both cost and retail,
and cost indexes for 2018 and 2019 are as follows: 2018 2019 Cost
Retail Cost Retail Beginning inventory $ 140,000 $ 200,000
Purchases 440,000 594,000 $ 680,000 $ 854,000 Purchase returns
3,500 4,350 3,200 4,550 Freight-in 6,600 5,000 Net markups 5,450
9,800 Net markdowns 4,300 7,000 Net sales to customers 480,000
702,000 Sales to employees (net of 20% discount) 19,200 19,200...
On January 1, 2021, HGC Camera Store adopted the dollar-value LIFO retail inventory method. Inventory transactions...
On January 1, 2021, HGC Camera Store adopted the dollar-value
LIFO retail inventory method. Inventory transactions at both cost
and retail, and cost indexes for 2021 and 2022 are as
follows:
2021
2022
Cost
Retail
Cost
Retail
Beginning inventory
$
31,200
$
48,000
Net purchases
82,720
112,000
$
90,275
$
118,800
Freight-in
2,400
2,900
Net markups
12,000
8,800
Net markdowns
2,400
2,600
Net sales to customers
109,815
104,960
Sales to employees (net of 20% discount)
2,900
4,640
Price Index:
January...
On January 1, 2021, the Coldstone Corporation adopted the dollar-value LIFO retail inventory method. Beginning inventory...
On January 1, 2021, the Coldstone Corporation adopted the
dollar-value LIFO retail inventory method. Beginning inventory at
cost and at retail were $180,000 and $282,000, respectively. Net
purchases during the year at cost and at retail were $604,500 and
$920,000, respectively. Markups during the year were $10,000. There
were no markdowns. Net sales for 2021 were $900,000. The retail
price index at the end of 2021 was 1.04. What is the inventory
balance that Coldstone would report in its 12/31/2021...
On January 1, 2018, HGC Camera Store adopted the dollar-value LIFO retail inventory method. Inventory transactions...
On January 1, 2018, HGC Camera Store adopted the dollar-value
LIFO retail inventory method. Inventory transactions at both cost
and retail, and cost indexes for 2018 and 2019 are as follows: 2018
2019 Cost Retail Cost Retail Beginning inventory $ 42,000 $ 60,000
Net purchases 94,500 118,000 $ 108,108 $ 133,200 Freight-in 3,000
3,500 Net markups 15,000 10,000 Net markdowns 3,000 3,200 Net sales
to customers 117,360 119,890 Sales to employees (net of 10%
discount) 3,600 6,300 Price Index: January...
On January 1, 2018, HGC Camera Store adopted the dollar-value LIFO retail inventory method. Inventory transactions...
On January 1, 2018, HGC Camera Store adopted the dollar-value
LIFO retail inventory method. Inventory transactions at both cost
and retail, and cost indexes for 2018 and 2019 are as
follows:
2018
2019
Cost
Retail
Cost
Retail
Beginning
inventory
$
58,500
$
78,000
Net purchases
110,180
127,000
$
115,808
$
133,100
Freight-in
3,900
4,400
Net markups
19,500
11,800
Net markdowns
3,900
4,100
Net sales to customers
125,380
119,140
Sales to employees (net of 20%
discount)
3,600
6,000
Price Index:
January...
On January 1, 2016, HGC Camera Store adopted the dollar-value LIFO retail inventory method. Inventory transactions...
On January 1, 2016, HGC Camera Store adopted the dollar-value
LIFO retail inventory method. Inventory transactions at both cost
and retail, and cost indexes for 2016 and 2017 are as follows: 2016
2017 Cost Retail Cost Retail Beginning inventory $ 51,800 $ 74,000
Net purchases 101,150 125,000 $ 107,532 $ 131,700 Freight-in 3,700
4,200 Net markups 18,500 11,400 Net markdowns 3,700 3,900 Net sales
to customers 125,250 118,800 Sales to employees (net of 20%
discount) 3,000 6,720 Price Index: January...
On January 1, 2018, HGC Camera Store adopted the dollar-value LIFO retail inventory method. Inventory transactions...
On January 1, 2018, HGC Camera Store adopted the dollar-value
LIFO retail inventory method. Inventory transactions at both cost
and retail, and cost indexes for 2018 and 2019 are as follows:
2018
2019
Cost
Retail
Cost
Retail
Beginning
inventory
$
42,000
$
60,000
Net purchases
94,500
118,000
$
108,108
$
133,200
Freight-in
3,000
3,500
Net markups
15,000
10,000
Net markdowns
3,000
3,200
Net sales to customers
117,360
119,890
Sales to employees (net of 10%
discount)
3,600
6,300
Price Index:
January...
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