Can you please give me correct answer this financial accounting question? Fletcher Home Goods uses the retail inventory method todetermine inventory values. It calculates merchandiseinventory at retail as $640,000. If the cost-to-retail ratio is72%, what is the amount of inventory to be reported onthe financial statements?

Step 1: Define Retail Inventory MethodThe Retail Inventory Method estimates the value of inventory…

Answered: Fletcher Home Goods uses the retail…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter6: Cost Of Goods Sold And Inventory

Section: Chapter Questions

Problem 7MCQ

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Fletcher Home Goods uses the retail inventory method to determine inventory values. It calculates merchandise inventory at retail as $640,000. If the cost-to-retail ratio is 72%, what is the amount of inventory to be reported on the financial statements?