The following information applies to the questions displayed below.] On January 1, 2021, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2021 and 2022 are as follows: 2021 2022 Cost Retail Cost Retail Beginning inventory $ 159,250 $ 245,000 Purchases 450,000 631,000 $ 685,000 $ 918,000 Purchase returns 4,500 3,550 4,100 4,500 Freight-in 7,200 7,000 Net markups 5,900 11,600 Net markdowns 4,600 7,900 Net sales to customers 500,000 720,000 Sales to employees (net of 20% discount) 24,000 24,000 Normal spoilage 3,500 6,800 Price Index: January 1, 2021 1.00 December 31, 2021 1.25 December 31, 2022 1.25
The following information applies to the questions displayed below.] On January 1, 2021, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2021 and 2022 are as follows: 2021 2022 Cost Retail Cost Retail Beginning inventory $ 159,250 $ 245,000 Purchases 450,000 631,000 $ 685,000 $ 918,000 Purchase returns 4,500 3,550 4,100 4,500 Freight-in 7,200 7,000 Net markups 5,900 11,600 Net markdowns 4,600 7,900 Net sales to customers 500,000 720,000 Sales to employees (net of 20% discount) 24,000 24,000 Normal spoilage 3,500 6,800 Price Index: January 1, 2021 1.00 December 31, 2021 1.25 December 31, 2022 1.25
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Topic Video
Question
The following information applies to the questions displayed below.]
On January 1, 2021, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2021 and 2022 are as follows:
| 2021 | 2022 | ||||||||||||
| Cost | Retail | Cost | Retail | ||||||||||
| Beginning inventory | $ | 159,250 | $ | 245,000 | |||||||||
| Purchases | 450,000 | 631,000 | $ | 685,000 | $ | 918,000 | |||||||
| Purchase returns | 4,500 | 3,550 | 4,100 | 4,500 | |||||||||
| Freight-in | 7,200 | 7,000 | |||||||||||
| Net markups | 5,900 | 11,600 | |||||||||||
| Net markdowns | 4,600 | 7,900 | |||||||||||
| Net sales to customers | 500,000 | 720,000 | |||||||||||
| Sales to employees (net of 20% discount) | 24,000 | 24,000 | |||||||||||
| Normal spoilage | 3,500 | 6,800 | |||||||||||
| Price Index: | |||||||||||||
| January 1, 2021 | 1.00 | ||||||||||||
| December 31, 2021 | 1.25 | ||||||||||||
| December 31, 2022 |
1.25
|
Transcribed Image Text:Required:
1. Estimate the 2021 and 2022 ending inventory and cost of goods sold using the dollar-value LIFO retail method.
2021
2022
Estimated ending inventory at retail
Estimated ending inventory at cost
Estimated cost of goods sold
Required:
2. Estimate the 2021 ending inventory and cost of goods sold using the average cost retail method. (Round your cost-to-retail
percentage to 2 decimal places and round your final answers to nearest whole dollar.)
Average Cost
Retail Method
Estimated ending inventory at retail
Estimated ending inventory at cost
Estimated cost of goods sold
Required:
3. Estimate the 2021 ending inventory and cost of goods sold using the conventional retail method. (Round your cost-to-retail
percentage to 2 decimal places and round your final answers to nearest whole dollar.)
Conventional
Retail Method
Estimated ending inventory at retail
Estimated ending inventory at cost
Estimated cost of goods sold
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