Angel Dress Shop had net retail sales of $125,000 during the current year. The following additional information was obtained from the company’s accounting records: At Cost At Retail Beginning inventory $20,000 $ 30,000 Net purchases (excluding freight-in) 70,000 110,000 Freight-in 5,200 1. Using the retail method, estimate the company’s ending inventory at cost. 2. Assume that a physical inventory taken at year end revealed an inventory on hand of $9,000 at retail value. What is the estimated amount of inventory shrinkage (loss due to theft, damage, etc.) at cost using the retail method
Angel Dress Shop had net retail sales of $125,000 during the current year. The following additional information was obtained from the company’s accounting records:
At Cost At Retail
Beginning inventory $20,000 $ 30,000
Net purchases (excluding freight-in) 70,000 110,000
Freight-in 5,200
1. Using the retail method, estimate the company’s ending inventory at cost.
2. Assume that a physical inventory taken at year end revealed an inventory on hand of $9,000 at retail value. What is the estimated amount of inventory shrinkage (loss due to theft, damage, etc.) at cost using the retail method?
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