Question
Noa Corporations uses the retail inventory method to estimate its ending inventory. The following information relates to Noa Corporations inventory at both cost and retail
Noa Corporations uses the retail inventory method to estimate its ending inventory. The following information relates to Noa Corporations inventory at both cost and retail for the current year.
| Description | Cost | Retail |
| Beginning Inventory | $55,000 | $78,500 |
| Purchases | 250,000 | 325,000 |
| Purchase discount | 10,000 |
|
| Freight-In | 5,000 |
|
| Additional markups |
| 24,000 |
| Markup cancellations |
| 7,000 |
| Markdowns |
| 12,000 |
| Markdown cancellations |
| 3,500 |
| Sales |
| 400,000 |
Instructions: Answer each of the following questions.
What is the ending inventory at retail?
|
|
If the ending inventory is to be valued at conventional retail method, the calculation of the cost to retail ratio should be based on what cost and retail?
|
|
Using the conventional retail method, calculate the approximate cost of ending inventory.
|
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started