Retail inventory method It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail. 1. Conventional Retail Method Conventional retail method refers to the estimation of the lower of average cost or market by eliminating the markdowns from the calculation of the cost-to-retail percentage. In this case, the cost-to-retail percentage will be determined by dividing the goods available for sale at cost by the goods available for at retail (excluding markdowns). Thus, the conventional retail method will always result in lower estimation of ending inventory when the markdowns exist. To Calculate: The amount of ending inventory.

Question

Want to see the full answer?

Answer 1

Question

Chapter 9, Problem 9.10P

1.

To determine

Retail inventory method

It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail.

1.

Conventional Retail Method

Conventional retail method refers to the estimation of the lower of average cost or market by eliminating the markdowns from the calculation of the cost-to-retail percentage.

In this case, the cost-to-retail percentage will be determined by dividing the goods available for sale at cost by the goods available for at retail (excluding markdowns). Thus, the conventional retail method will always result in lower estimation of ending inventory when the markdowns exist.

To Calculate: The amount of ending inventory.

2.

To determine

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).

3.

To determine

Dollar-Value-LIFO

This method shows all the inventory figures at dollar price rather than units. Under this inventory method, the units that are purchased last are sold first. Thus, it starts from the selling of the units recently purchased and ending with the beginning inventory.

To Estimate: the ending inventory in 2015 and 2016 using dollar-value LIFO retail method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Sterling Manufacturing had a quick ratio of 1.5, a current ratio of 3.2, an inventory turnover ratio of 6, total current assets of $900,000, and cash and equivalents of $150,000 in 2020. If the cost of goods sold equaled 85% of sales, what were Sterling's annual sales and days' sales outstanding (DSO)?

What is the addition to retained earnings of this financial accounting question?

Provide correct option general accounting question

Answer 2

Question

Chapter 9, Problem 9.10P

1.

To determine

Retail inventory method

It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail.

1.

Conventional Retail Method

Conventional retail method refers to the estimation of the lower of average cost or market by eliminating the markdowns from the calculation of the cost-to-retail percentage.

In this case, the cost-to-retail percentage will be determined by dividing the goods available for sale at cost by the goods available for at retail (excluding markdowns). Thus, the conventional retail method will always result in lower estimation of ending inventory when the markdowns exist.

To Calculate: The amount of ending inventory.

2.

To determine

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).

3.

To determine

Dollar-Value-LIFO

This method shows all the inventory figures at dollar price rather than units. Under this inventory method, the units that are purchased last are sold first. Thus, it starts from the selling of the units recently purchased and ending with the beginning inventory.

To Estimate: the ending inventory in 2015 and 2016 using dollar-value LIFO retail method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 9, Problem 9.10P

1.

To determine

Retail inventory method

It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail.

1.

Conventional Retail Method

Conventional retail method refers to the estimation of the lower of average cost or market by eliminating the markdowns from the calculation of the cost-to-retail percentage.

In this case, the cost-to-retail percentage will be determined by dividing the goods available for sale at cost by the goods available for at retail (excluding markdowns). Thus, the conventional retail method will always result in lower estimation of ending inventory when the markdowns exist.

To Calculate: The amount of ending inventory.

2.

To determine

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).

3.

To determine

Dollar-Value-LIFO

This method shows all the inventory figures at dollar price rather than units. Under this inventory method, the units that are purchased last are sold first. Thus, it starts from the selling of the units recently purchased and ending with the beginning inventory.

To Estimate: the ending inventory in 2015 and 2016 using dollar-value LIFO retail method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 9, Problem 9.10P

1.

To determine

Retail inventory method

It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail.

1.

Conventional Retail Method

Conventional retail method refers to the estimation of the lower of average cost or market by eliminating the markdowns from the calculation of the cost-to-retail percentage.

In this case, the cost-to-retail percentage will be determined by dividing the goods available for sale at cost by the goods available for at retail (excluding markdowns). Thus, the conventional retail method will always result in lower estimation of ending inventory when the markdowns exist.

To Calculate: The amount of ending inventory.

2.

To determine

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).

3.

To determine

Dollar-Value-LIFO

This method shows all the inventory figures at dollar price rather than units. Under this inventory method, the units that are purchased last are sold first. Thus, it starts from the selling of the units recently purchased and ending with the beginning inventory.

To Estimate: the ending inventory in 2015 and 2016 using dollar-value LIFO retail method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 9, Problem 9.10P

1.

To determine

Retail inventory method

It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail.

1.

Conventional Retail Method

Conventional retail method refers to the estimation of the lower of average cost or market by eliminating the markdowns from the calculation of the cost-to-retail percentage.

In this case, the cost-to-retail percentage will be determined by dividing the goods available for sale at cost by the goods available for at retail (excluding markdowns). Thus, the conventional retail method will always result in lower estimation of ending inventory when the markdowns exist.

To Calculate: The amount of ending inventory.

2.

To determine

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).

3.

To determine

Dollar-Value-LIFO

This method shows all the inventory figures at dollar price rather than units. Under this inventory method, the units that are purchased last are sold first. Thus, it starts from the selling of the units recently purchased and ending with the beginning inventory.

To Estimate: the ending inventory in 2015 and 2016 using dollar-value LIFO retail method.

Answer 6

Chapter 9, Problem 9.10P

1.

To determine

Retail inventory method

It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail.

1.

Conventional Retail Method

Conventional retail method refers to the estimation of the lower of average cost or market by eliminating the markdowns from the calculation of the cost-to-retail percentage.

In this case, the cost-to-retail percentage will be determined by dividing the goods available for sale at cost by the goods available for at retail (excluding markdowns). Thus, the conventional retail method will always result in lower estimation of ending inventory when the markdowns exist.

To Calculate: The amount of ending inventory.

Answer 7

Chapter 9, Problem 9.10P

1.

To determine

Retail inventory method

It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail.

1.

Conventional Retail Method

Conventional retail method refers to the estimation of the lower of average cost or market by eliminating the markdowns from the calculation of the cost-to-retail percentage.

In this case, the cost-to-retail percentage will be determined by dividing the goods available for sale at cost by the goods available for at retail (excluding markdowns). Thus, the conventional retail method will always result in lower estimation of ending inventory when the markdowns exist.

To Calculate: The amount of ending inventory.

Answer 8

2.

To determine

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).

Answer 9

2.

To determine

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).

Answer 10

3.

To determine

Dollar-Value-LIFO

This method shows all the inventory figures at dollar price rather than units. Under this inventory method, the units that are purchased last are sold first. Thus, it starts from the selling of the units recently purchased and ending with the beginning inventory.

To Estimate: the ending inventory in 2015 and 2016 using dollar-value LIFO retail method.

Answer 11

3.

To determine

Dollar-Value-LIFO

This method shows all the inventory figures at dollar price rather than units. Under this inventory method, the units that are purchased last are sold first. Thus, it starts from the selling of the units recently purchased and ending with the beginning inventory.

To Estimate: the ending inventory in 2015 and 2016 using dollar-value LIFO retail method.

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 15

Ch. 9 - Prob. 9.1Q Ch. 9 - Prob. 9.2Q Ch. 9 - Describe the alternative approaches for recording...Ch. 9 - Explain the gross profit method of estimating...Ch. 9 - The Rider Company uses the gross profit method to...Ch. 9 - Explain the retail inventory method of estimating...Ch. 9 - Both the gross profit method and the retail...Ch. 9 - Define each of the following retail terms: initial...Ch. 9 - Explain how to estimate the average cost of...Ch. 9 - Prob. 9.10Q

Concept explainers

Videos

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).

Want to see the full answer?

Chapter 9 Solutions

Concept explainers

Videos

Last-In, First-Out (LIFO) In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items. To Estimate: the amount of ending inventory (LIFO).

Want to see the full answer?

Chapter 9 Solutions

Last-In, First-Out (LIFO)

In Last-in-First-Out method, the costs of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

To Estimate: the amount of ending inventory (LIFO).