Irving inc

7. Radighieri inc. uses the retail inventory method to estimate ending inventory for its monthly financial statements. The following data pertain to a single department for the month of August 2018 Inventory, August 1. 2018 At cost $ 1.000 At retail $136.000 Purchases (exclusive of freight and returns) At cost $185.000 At retail $261.000 Freight-in 21,600 Purchase returns At cost $9.200 At retail $12,400 Markups $9,000 Markup cancellations $3,000 Markdowns (net) $16,600 Normal spoilage and breakage at retail $6,000 Sales $310,000 a. Use the average cost retail method to estimate ending inventory and Cost of Goods Sold. b. Using the conventional retail method, prepare a schedule computing estimated lower-of- cost-or-market inventory and Cost of Goods Sold for August 31, 2018. c. Finally, prepare Radigheiri's inventory using the LIFO retail method. 9. Some transactions for XYZ, Inc. of XYZ Company during March are listed below. XYZ uses the periodic inventory method. March 8 Purchased merchandise on account. $15.000, terms 1/10. n/30. 11 Returned part of the purchase of March 8, $2,200, and received credit on account. 17 Purchased merchandise on account, $16.000, terms 2/10, n/30. 26 Paid invoice of March 17 in full. 27 Purchased merchandise on account, $36.000, terms 2/10, n/60. Instructions (a) Assuming that purchases are recorded at gross amounts and that discounts are to be recorded when taken: (1) Prepare general journal entries to record the transactions using the gross method (2) Prepare the general journal entries to record the transactions using the net method. (3) Discuss which of the two methods do you prefer and why