Grand Department Store, Incorporated, uses the retail inventory method to estimate ending inventory for its monthly financial statements. The following data pertain to a single department for the month of October: Beginning inventory: At cost At retail Purchases (exclusive of freight and returns): At cost At retail Freight-in Purchase returns: At cost At retail. Additional markups Markup cancellations Markdowns (net) Normal spoilage and breakage Sales Sales returns Beginning inventory Goods available for sale Cost-to-retail percentage Goods available for sale Less: Net Sales $ 25,000 35,000 Estimated ending inventory at retail Estimated ending inventory at cost Estimated cost of goods sold 98,108 151,500 5,600 Required: 1. Using the conventional retail ending inventory method, prepare a schedule computing estimated lower of cost or market (LCM) inventory and cost of goods sold for October. Note: Round your cost-to-retail percentage to 2 decimal places (i.e., 0.1234 should be entered as 12.34) and round your final answers to the nearest whole dollar. 2,600 3,300 3,000 200 850 5,000 144,500 3,770 Cost Retail 0 Cost-to-Retail Ratio
Grand Department Store, Incorporated, uses the retail inventory method to estimate ending inventory for its monthly financial statements. The following data pertain to a single department for the month of October: Beginning inventory: At cost At retail Purchases (exclusive of freight and returns): At cost At retail Freight-in Purchase returns: At cost At retail. Additional markups Markup cancellations Markdowns (net) Normal spoilage and breakage Sales Sales returns Beginning inventory Goods available for sale Cost-to-retail percentage Goods available for sale Less: Net Sales $ 25,000 35,000 Estimated ending inventory at retail Estimated ending inventory at cost Estimated cost of goods sold 98,108 151,500 5,600 Required: 1. Using the conventional retail ending inventory method, prepare a schedule computing estimated lower of cost or market (LCM) inventory and cost of goods sold for October. Note: Round your cost-to-retail percentage to 2 decimal places (i.e., 0.1234 should be entered as 12.34) and round your final answers to the nearest whole dollar. 2,600 3,300 3,000 200 850 5,000 144,500 3,770 Cost Retail 0 Cost-to-Retail Ratio
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Grand Department Store, Incorporated, uses the retail inventory method to estimate ending inventory for its monthly financial
statements. The following data pertain to a single department for the month of October:
Beginning inventory:
At cost
At retail)
Purchases (exclusive of freight and returns):
At cost
At retail
Freight-in
Purchase returns:
At cost
At retail
Additional markups
Markup cancellations.
Markdowns (net)
Normal spoilage and breakage
Sales
Sales returns
Beginning inventory
Goods available for sale
Cost-to-retail percentage
Required:
1. Using the conventional retail ending inventory method, prepare a schedule computing estimated lower of cost or market (LCM)
inventory and cost of goods sold for October.
Goods available for sale
$ 25,000
35,000
Note: Round your cost-to-retail percentage to 2 decimal places (i.e., 0.1234 should be entered as 12.34) and round your final
answers to the nearest whole dollar.
Less: Net Sales
98,108
151,500
5,600
Estimated ending inventory at retail
Estimated ending inventory at cost
Estimated cost of goods sold
2,600
3,300
3,000
200
850
5,000
144,500
3,770
Cost
Retail
0
Cost-to-Retail
Ratio](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F012be4ac-25f7-4b84-9847-d3cc80340491%2F84dee3dc-41b8-4fee-91e1-242c57396cc4%2Fwqanb8b_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Grand Department Store, Incorporated, uses the retail inventory method to estimate ending inventory for its monthly financial
statements. The following data pertain to a single department for the month of October:
Beginning inventory:
At cost
At retail)
Purchases (exclusive of freight and returns):
At cost
At retail
Freight-in
Purchase returns:
At cost
At retail
Additional markups
Markup cancellations.
Markdowns (net)
Normal spoilage and breakage
Sales
Sales returns
Beginning inventory
Goods available for sale
Cost-to-retail percentage
Required:
1. Using the conventional retail ending inventory method, prepare a schedule computing estimated lower of cost or market (LCM)
inventory and cost of goods sold for October.
Goods available for sale
$ 25,000
35,000
Note: Round your cost-to-retail percentage to 2 decimal places (i.e., 0.1234 should be entered as 12.34) and round your final
answers to the nearest whole dollar.
Less: Net Sales
98,108
151,500
5,600
Estimated ending inventory at retail
Estimated ending inventory at cost
Estimated cost of goods sold
2,600
3,300
3,000
200
850
5,000
144,500
3,770
Cost
Retail
0
Cost-to-Retail
Ratio
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