Plank Co. uses the retail inventory method. The following information is available for the current year. Cost Retail Beginning inventory $234,000 $366,000 Purchases 885,000 1,245,000 Freight-in 15,000 Employee discounts 6,000 Net markups 45,000 Net markdowns 60,000 1,170,000 Sales revenue If the ending inventory is to be valued at approximately lower of average cost or market, the calculation of the cost ratio should be based on cost and retail of: a. $1,134,000 and $1,656,000. b. $1,119,000 and $1,650,000. c. $900,000 and $1,290,000. d. $900,000 and $1,284,000.

Plank Co. uses the retail inventory method. The following information is available for the current year. Cost Retail Beginning inventory $234,000 $366,000 Purchases 885,000 1,245,000 Freight-in 15,000 Employee discounts 6,000 Net markups 45,000 Net markdowns 60,000 1,170,000 Sales revenue If the ending inventory is to be valued at approximately lower of average cost or market, the calculation of the cost ratio should be based on cost and retail of: a. $1,134,000 and $1,656,000. b. $1,119,000 and $1,650,000. c. $900,000 and $1,290,000. d. $900,000 and $1,284,000.

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 6MCQ: Refer to the information for Morgan Inc. above. If Morgan uses a perpetual inventory system, what is...

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