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In: Accounting

Presented below is information related to Kingbird Company. Cost Retail Beginning inventory $186,032$281,000 Purchases 1,393,0002,147,000 Markups...

Presented below is information related to Kingbird Company.

Cost

Retail

Beginning inventory

$186,032$281,000

Purchases

1,393,0002,147,000

Markups

93,500

Markup cancellations

15,100

Markdowns

37,000

Markdown cancellations

4,500

Sales revenue

2,236,000

Compute the inventory by the conventional retail inventory method. (Round ratios for computational purposes to 0 decimal places, e.g. 78% and final answer to 0 decimal places, e.g. 28,987.)

Expert Solution

Ending Inventory using conventional retail inventory method

$ 149,877.00

--Working

Conventional Retail Method
	Cost	Retail	Cost to Retail Ratio	Working
Beginning Inventory	$ 186,032.00	$ 281,000.00
*Plus:* Purchases	$ 1,393,000.00	$ 2,147,000.00
Net Markups		$ 78,400.00
	$ 1,579,032.00	$ 2,506,400.00
*Less:* Net MarkDowns		$ 32,500.00
Goods Available for sale	$ 1,579,032.00	$ 2,473,900.00

*Cost to retail Percentage*			63.00%	( 1579032 / 2506400 ) x 100
*Less:* Net Sales		$ 2,236,000.00
Estimated ending inventory at retail		$ 237,900.00		2473900 - 2236000
Estimated ending Inventory at cost	$ 149,877.00 ANSWER			237900 x 0.63

ekkarill92 answered 1 year ago

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