Empress Company used the retail inventory method to approximate the ending inventory. The following information is available for the current year; Cost Retail 650,000 9,000,000 200,000 300,000 150,000 200,000 1,200,000 14,700,000 Beginning inventory Purchases Freight in Purchase returns Purchase allowances Departmental transfer in Net markup Net markdown Sales Sales discounts 500,000 300,000 300,000 1,000,000 9,500,000 100,000 500,000 600,000 400,000 Employee discounts Estimated normal shoplifting losses Estimated normal shrinkage
Empress Company used the retail inventory method to approximate the ending inventory. The following information is available for the current year; Cost Retail 650,000 9,000,000 200,000 300,000 150,000 200,000 1,200,000 14,700,000 Beginning inventory Purchases Freight in Purchase returns Purchase allowances Departmental transfer in Net markup Net markdown Sales Sales discounts 500,000 300,000 300,000 1,000,000 9,500,000 100,000 500,000 600,000 400,000 Employee discounts Estimated normal shoplifting losses Estimated normal shrinkage
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
a. What is the estimated cost of the ending inventory if the conservative approach was used?
b. What is the estimated cost of the ending inventory if the average cost approach was used?
c. What is the estimated cost of the ending inventory if the FIFO approach was used?
Please present the solution in good accounting form.
Transcribed Image Text:Empress Company used the retail inventory method to
The following information is available for the current year:
approximate the ending inventory.
The following information is available for the current ve
Cost
Retail
650,000
9,000,000
200,000
300,000
150,000
200,000
Beginning inventory
Purchases
1,200,000
14,700,000
Freight in
Purchase returns
Purchase allowances
Departmental transfer in
Net markup
Net markdown
Sales
Sales discounts
Employee discounts
Estimated normal shoplifting losses
Estimated normal shrinkage
500,000
300,000
300,000
1,000,000
9,500,000
100,000
500,000
600,000
400,000
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