! Required information [The following information applies to the questions displayed below.] Sparrow Company uses the retail inventory method to estimate ending inventory and cost of goods sold. Data for 2024 are as follows: Beginning inventory Purchases Freight-in Purchase returns Net markups Net markdowns Normal spoilage Abnormal spoilage Sales Sales returns Cost $ 95,000 Retail $ 185,000 359,000 585,000 9,500 7,500 11,500 16,500 12,500 3,500 4,354 8,500 545,000 10,500 The company records sales net of employee discounts. Employee discounts for 2024 totaled $4,500. Required: 1. Estimate Sparrow's ending inventory and cost of goods sold for the year using the retail inventory method and the average cost application. Note: Round Cost-to-retail percentage to 2 decimal places and final answers to the nearest whole dollar amount.

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter10: Inventory
Section: Chapter Questions
Problem 10PA: Calculate a) cost of goods sold, b) ending inventory, and c) gross margin for A76 Company,...
icon
Related questions
Question

hr2

!
Required information
[The following information applies to the questions displayed below.]
Sparrow Company uses the retail inventory method to estimate ending inventory and cost of goods sold.
Data for 2024 are as follows:
Beginning inventory
Purchases
Freight-in
Purchase returns
Net markups
Net markdowns
Normal spoilage
Abnormal spoilage
Sales
Sales returns
Cost
$ 95,000
Retail
$ 185,000
359,000
585,000
9,500
7,500
11,500
16,500
12,500
3,500
4,354
8,500
545,000
10,500
The company records sales net of employee discounts. Employee discounts for 2024 totaled $4,500.
Required:
1. Estimate Sparrow's ending inventory and cost of goods sold for the year using the retail inventory method and the
average cost application.
Note: Round Cost-to-retail percentage to 2 decimal places and final answers to the nearest whole dollar amount.
Transcribed Image Text:! Required information [The following information applies to the questions displayed below.] Sparrow Company uses the retail inventory method to estimate ending inventory and cost of goods sold. Data for 2024 are as follows: Beginning inventory Purchases Freight-in Purchase returns Net markups Net markdowns Normal spoilage Abnormal spoilage Sales Sales returns Cost $ 95,000 Retail $ 185,000 359,000 585,000 9,500 7,500 11,500 16,500 12,500 3,500 4,354 8,500 545,000 10,500 The company records sales net of employee discounts. Employee discounts for 2024 totaled $4,500. Required: 1. Estimate Sparrow's ending inventory and cost of goods sold for the year using the retail inventory method and the average cost application. Note: Round Cost-to-retail percentage to 2 decimal places and final answers to the nearest whole dollar amount.
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Principles of Accounting Volume 1
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Financial Accounting
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
College Accounting, Chapters 1-27
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,