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In: Accounting
The records of Lohse Stores included the following data: Inventory, May 1, at retail, $14,500; at...
The records of Lohse Stores included the following data: Inventory, May 1, at retail, $14,500; at cost, $10,440 Purchases during May, at retail, $42,900; at cost, $31,550 Freight-in, $2,000; purchase discounts, $250 Additional markups, $3,800; markup cancellations, $400; net markdowns, $1,300 Sales during May, $45,500 Calculate the estimated inventory at May 31 on a LIFO basis. Estimated inventory
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Expert Solution
| Computation of the estimated inventory at May 31 on a LIFO basis | ||
| Cost ($) | ||
| Inventory, May 1 | 10,440.00 | 14,500.00 |
| Purchases | 31,550.00 | 42,900.00 |
| Freight - in | 2,000.00 | - |
| Purchase discounts | (250.00) | - |
| Add: Net markups (3,800-400) | - | 3,400.00 |
| Less: Net markdowns: | - | (1,300.00) |
| Totals excluding beginning inventory | 33,300.00 | 45,000.00 |
| Goods available | 43,740.00 | 59,500.00 |
| Less: sales | (45,500.00) | |
| Ending inventory, at retail | 14,000.00 | |
| Cost-to-retail ratio = 10,440,500/14 = 72% | ||
| Ending inventory at cost = 14,000 * 72% = $10,080 | ||
ekkarill92 answered 2 years agoRelated Solutions
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Purchase returns
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Beginning inventory
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102,300
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165,000
Purchases
484,000
715,000
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625,000
$
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Purchase
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2,800
1,500
2,500
6,100
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8,000
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8,400
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2,900
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Net markups
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400,000
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