Estimate the ending inventory using the retail inventory method. Re 74%) [Please note it is
Estimate the ending inventory using the retail inventory method. Re 74%) [Please note it is
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 46E
Related questions
Question
![The records of Hamilton Apparel display the following data for the month of October:
Sales
$72,500
Purchase (at cost)
$35,000
Sales returns
$1,500
Purchase (at retail)
$65.800
Markups
$6,500
Purchase return (at cost)
$1,500
Markup cancellations
$900
Purchase return (at retail)
$2,100
Markdowns
$5,200
Beginning inventory (at cost)
$20,500
Markdown cancellations
$1,200
Beginning inventory (at retail) $30,700
Freight on purchase
$2,200
Required:
a. Estimate the ending inventory using the retail inventory method. Round the cost ratio
to two decimal places based on % (e.g, 36.76%). [Please note it is NOT conventional
retail method].
W
b. Estimate the ending inventory using the conventional retail inventory method. Round
the cost ratio to two decimal places based on % (e.g, 36.76%).](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2375f726-1e3d-4bc1-bcbf-97dbd6753264%2F8c221a65-3e1f-4268-90db-c92a895f86f0%2Fd7pf14u_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The records of Hamilton Apparel display the following data for the month of October:
Sales
$72,500
Purchase (at cost)
$35,000
Sales returns
$1,500
Purchase (at retail)
$65.800
Markups
$6,500
Purchase return (at cost)
$1,500
Markup cancellations
$900
Purchase return (at retail)
$2,100
Markdowns
$5,200
Beginning inventory (at cost)
$20,500
Markdown cancellations
$1,200
Beginning inventory (at retail) $30,700
Freight on purchase
$2,200
Required:
a. Estimate the ending inventory using the retail inventory method. Round the cost ratio
to two decimal places based on % (e.g, 36.76%). [Please note it is NOT conventional
retail method].
W
b. Estimate the ending inventory using the conventional retail inventory method. Round
the cost ratio to two decimal places based on % (e.g, 36.76%).
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Managerial Accounting: The Cornerstone of Busines…](https://www.bartleby.com/isbn_cover_images/9781337115773/9781337115773_smallCoverImage.gif)
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
![Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337272124/9781337272124_smallCoverImage.gif)
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
![Managerial Accounting: The Cornerstone of Busines…](https://www.bartleby.com/isbn_cover_images/9781337115773/9781337115773_smallCoverImage.gif)
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
![Financial Accounting](https://www.bartleby.com/isbn_cover_images/9781337272124/9781337272124_smallCoverImage.gif)
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
![Financial And Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337902663/9781337902663_smallCoverImage.jpg)
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
![Excel Applications for Accounting Principles](https://www.bartleby.com/isbn_cover_images/9781111581565/9781111581565_smallCoverImage.gif)
Excel Applications for Accounting Principles
Accounting
ISBN:
9781111581565
Author:
Gaylord N. Smith
Publisher:
Cengage Learning
![Intermediate Accounting: Reporting And Analysis](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning