Question
On January 1, 2018, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2018 and
On January 1, 2018, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2018 and 2019 are as follows:
2018Cost Retail Cost Retail 2019
Beginning inventory $150,500 $215,000
Purchases 640,000 852,000 $735,000 $923,000
Purchase returns 2,700 5,650 3,500 5,475
Freight-in 6,800 5,000
Net markups 5,600 10,400
Net markdowns 4,450 7,300
Net sales to customers 560,000 708,000
Sales to employees (net of 20% discount)20,000 20,000
Normal spoilage 3,100 2,000
Price Index:
January 1, 20181.00
December 31, 20181.25
December 31, 20191.25
Required:
1.Estimate the 2018 and 2019 ending inventory and cost of goods sold using the dollar-value LIFO retail method.
2.Estimate the 2018 ending inventory and cost of goods sold using the average cost retail method.
3.Estimate the 2018 ending inventory and cost of goods sold using the conventional retail method.
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