Intermediate Accounting
3rd Edition
ISBN: 9780136912644
Author: Elizabeth A. Gordon; Jana S. Raedy; Alexander J. Sannella
Publisher: Pearson Education (US)
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Textbook Question
Chapter 10, Problem 10.13P
Basic Retail Inventory Method and Conventional Retail Inventory Methods. The Monte Sales Company provided the following data related to its inventory at the end of the current year Round percentages to two decimal places
| Description | Cost | Retail |
| Beginning inventory | $21,800 | $45,000 |
| Purchases | 112,500 | 132,000 |
| Additional markups | 21,000 | |
| Markup cancellations | 4,200 | |
| Markdowns | 15,800 | |
| Markdown cancellations | 2,800 | |
| Sales | 165,000 |
Required
- a. What are Monte’s ending inventory and cost of goods sold under the conventional retail method?
- b. What are Monte’s ending inventory and cost of goods sold under the basic retail method?
- c. Which method provides the lower ending inventory value consistent with the lower-of-cost-or-market method?
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Chapter 10 Solutions
Intermediate Accounting
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