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Beginning inventory (cost) Net purchases (cost) Sales at retail Mark-ups at retail Mark-downs at retail Staff discounts (on items sold) at retail $ 45 000 75 000 110 000 3 021 11 858 5 814

Beginning inventory (cost) Net purchases (cost) Sales at retail Mark-ups at retail Mark-downs at retail Staff discounts (on items sold) at retail $ 45 000 75 000 110 000 3 021 11 858 5 814

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Heaven Scent is a retail business selling handmade soaps, essential oils, candles and lotions. The manager is required to prepare quarterly financial reports for the owner of the business. To assist with this process, and to save having to perform a physical stocktake every quarter, the business uses the retail inventory method for interim reporting purposes. Beginning inventory (cost) $45 000 75 000 Net purchases (cost) Sales at retail 110 000 Mark-ups at retail 3 021 Mark-downs at retail 11 858 Staff discounts (on items sold) at retail 5 814 (Note: the same data has been provided in the pdf. document you downloaded before) Required: The manager requires an estimate be made of: 1. inventory on hand at cost for the quarter ending 31 March 2022. 2. the gross profit to assist the manager with preparing the quarterly financial reports. (Note: you only need to show your final calculations in your answer)
Transcribed Image Text:Heaven Scent is a retail business selling handmade soaps, essential oils, candles and lotions. The manager is required to prepare quarterly financial reports for the owner of the business. To assist with this process, and to save having to perform a physical stocktake every quarter, the business uses the retail inventory method for interim reporting purposes. Beginning inventory (cost) $45 000 75 000 Net purchases (cost) Sales at retail 110 000 Mark-ups at retail 3 021 Mark-downs at retail 11 858 Staff discounts (on items sold) at retail 5 814 (Note: the same data has been provided in the pdf. document you downloaded before) Required: The manager requires an estimate be made of: 1. inventory on hand at cost for the quarter ending 31 March 2022. 2. the gross profit to assist the manager with preparing the quarterly financial reports. (Note: you only need to show your final calculations in your answer)
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