Retail inventory method Retail inventory method is a method of estimating the cost of inventory, and it establishes a relationship between the cost and sale price. This method shows both the cost and retail value of the goods available for sale in a company’s record. (a) The estimated cost of the ending inventory for each department at October 31, 2015 under the retail inventory method.

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Chapter 6, Problem 6.11AP

(a)

To determine

Retail inventory method

Retail inventory method is a method of estimating the cost of inventory, and it establishes a relationship between the cost and sale price. This method shows both the cost and retail value of the goods available for sale in a company’s record.

(a)

The estimated cost of the ending inventory for each department at October 31, 2015 under the retail inventory method.

(b)

To determine

To compute: The ending inventory at cost for each department at December 31.

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Required information Skip to question [The following information applies to the questions displayed below.]Brianna's Boutique has the following transactions related to its top-selling Gucci purse for the month of October. Brianna's Boutique uses a periodic inventory system. Date Transactions Units Unit Cost Total Cost October 1 Beginning inventory 6 $830 $4,980 October 4 Sale 4 October 10 Purchase 5 840 4,200 October 13 Sale 3 October 20 Purchase 4 850 3,400 October 28 Sale 7 October 30 Purchase 6 860 5,160 $17,740 2. Using FIFO, calculate ending inventory and cost of goods sold at October 31.