Campbell Corporation uses the retail method to value its inventory. The following information is available for the year 2021: Cost Retail Merchandise inventory, January 1, 2021 Purchases $260,000 544,420 10,800 $350,000 910,000 Freight-in Net markups 34,000 18,000 870,000 Net markdowns Net sales
Campbell Corporation uses the retail method to value its inventory. The following information is available for the year 2021: Cost Retail Merchandise inventory, January 1, 2021 Purchases $260,000 544,420 10,800 $350,000 910,000 Freight-in Net markups 34,000 18,000 870,000 Net markdowns Net sales
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Exercise 9-14 (Algo) Conventional retail method [LO9-3]
Campbell Corporation uses the retail method to value its inventory. The following information is available for the year 2021:
Cost
Retail
Merchandise inventory, January 1, 2021
$260,000
544,420
10,800
$350,000
910,000
Purchases
Freight-in
Net markups
Net markdowns
34,000
18,000
870,000
Net sales
Required:
Determine the December 31, 2021, inventory by applying the conventional retail method using the information provided. (Round ratio
calculation to 2 decimal places (i.e., 0.1234 should be entered as 12.34%.). Enter amounts to be deducted with a minus sign.)
Answer is complete but not entirely correct.
Cost-to-
Retail Ratio
Cost
Retail
Beginning inventory
$
260,000
24
350,000
Purchases
544,420
910,000
Freight-in
10,800
34,000
Net markups
1,294,000
(18,000)
Net markdowns
815,220
1,276,000
Goods available for sale
64.00
%
Cost-to-retail percentage](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3e1bfd6a-3cb6-4031-858f-4ba8da8545b1%2Fefb498a5-c1c4-4a30-a1bb-5aa4f0861d14%2Faiyvou_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 9-14 (Algo) Conventional retail method [LO9-3]
Campbell Corporation uses the retail method to value its inventory. The following information is available for the year 2021:
Cost
Retail
Merchandise inventory, January 1, 2021
$260,000
544,420
10,800
$350,000
910,000
Purchases
Freight-in
Net markups
Net markdowns
34,000
18,000
870,000
Net sales
Required:
Determine the December 31, 2021, inventory by applying the conventional retail method using the information provided. (Round ratio
calculation to 2 decimal places (i.e., 0.1234 should be entered as 12.34%.). Enter amounts to be deducted with a minus sign.)
Answer is complete but not entirely correct.
Cost-to-
Retail Ratio
Cost
Retail
Beginning inventory
$
260,000
24
350,000
Purchases
544,420
910,000
Freight-in
10,800
34,000
Net markups
1,294,000
(18,000)
Net markdowns
815,220
1,276,000
Goods available for sale
64.00
%
Cost-to-retail percentage
Transcribed Image Text:Freight-in
Net markups
Net markdowns
Net sales
10,800
34,000
18,000
870,000
Required:
Determine the December 31, 2021, inventory by applying the conventional retail method using the information provided. (Round ratio
calculation to 2 decimal places (i.e., 0.1234 should be entered as 12.34%.). Enter amounts to be deducted with a minus sign.)
X Answer is complete but not entirely correct.
Cost-to-
Cost
Retail
Retail Ratio
Beginning inventory
2$
260,000
$
350,000
Purchases
544,420
910,000
Freight-in
10,800
Net markups
34,000
1,294,000
Net markdowns
(18,000)
Goods available for sale
815,220
1,276,000
Cost-to-retail percentage
64.00 X %
Net sales
(870,000)
Estimated ending inventory at retail
406,000
Estimated ending inventory at cost
(739,500) X
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