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Company A uses retail inventory method to value its inventory. The following information is available for the current year: Cost Retail Beginning Inventory 550,000 1,100,000

Company A uses retail inventory method to value its inventory. The following information is available for the current year:

Cost

Retail

Beginning Inventory

550,000

1,100,000

Purchases

7,900,000

13,150,000

Freight-in

200,000

Purchase returns

300,000

500,000

Purchase allowances

150,000

Departmental transfer-in

200,000

400,000

Net mark-ups

300,000

Net markdowns

450,000

Sales

12,350,000

Sales returns

175,000

Sales discounts

100,000

Employee discounts

300,000

Loss from breakage

25,000

Determined (round off your cost ratio to nearest whole percentage):

  1. Under average approach, the estimated ending inventory at cost
  2. Under conventional approach, the estimated cost of goods sold
  3. Under FIFO approach, the estimated shortage in inventory if physical count is P350,000.

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