Brief Exercise 9-8 (Algo) Retail inventory method; LIFO [LO9-3]Kiddie World uses a periodic inventory system and the retail inventory method to estimate ending inventory and cost of goods sold.The following data are available for the quarter ending September 30, 2021:Beginning inventory.Net purchasesFreight-inNet markupsNet markdownsNet salesCostRetail$440,000 $ 575,0001,350,000925,00062,150Estimate ending inventory and cost of goods sold (LIFO). (Round ratio calculation to 2 decimal places (i.e., 0.1234 should be enteredas 12.34%.))Cost-to-retail percentageBeginning inventoryPlus: Net purchasesFreight-inNet markupsLess: Net markdownsGoods available for sale (excluding beg. Inventory)Goods available for sale (including beg. Inventory)Less: Net salesEstimated ending inventory at retailEstimated ending inventory at costEstimated cost of goods sold62,00032,0001,270,000X Answer is complete but not entirely correct.$$Cost440,000925,00062,150987,1501,427,150489,980 X937,170$$Retail575,0001,350,00062,00032,0001,380,0001,955,000(1,270,000)685,000Cost-to-RetailRatio71.53%

Under the period inventory system a physical count of stock are performed through out specific time…

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Estimate ending inventory and cost of goods sold (LIFO). (R 2.500M

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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Question

Brief Exercise 9-8 (Algo) Retail inventory method; LIFO [LO9-3]
Kiddie World uses a periodic inventory system and the retail inventory method to estimate ending inventory and cost of goods sold.
The following data are available for the quarter ending September 30, 2021:
Beginning inventory.
Net purchases
Freight-in
Net markups
Net markdowns
Net sales
Cost
Retail
$440,000 $ 575,000
1,350,000
925,000
62,150
Estimate ending inventory and cost of goods sold (LIFO). (Round ratio calculation to 2 decimal places (i.e., 0.1234 should be entered
as 12.34%.))
Cost-to-retail percentage
Beginning inventory
Plus: Net purchases
Freight-in
Net markups
Less: Net markdowns
Goods available for sale (excluding beg. Inventory)
Goods available for sale (including beg. Inventory)
Less: Net sales
Estimated ending inventory at retail
Estimated ending inventory at cost
Estimated cost of goods sold
62,000
32,000
1,270,000
X Answer is complete but not entirely correct.
$
$
Cost
440,000
925,000
62,150
987,150
1,427,150
489,980 X
937,170
$
$
Retail
575,000
1,350,000
62,000
32,000
1,380,000
1,955,000
(1,270,000)
685,000
Cost-to-
Retail
Ratio
71.53%

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