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On January 1, 2021, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2021
On January 1, 2021, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2021 and 2022 are as follows: 2021 Beginning inventory Purchases Purchase returns Freight-in Net markups Net markdowns Net sales to customers Sales to employees (net of 25% discount) Normal spoilage Price Index: January 1, 2021 December 31, 2021 December 31, 2022 2022 Cost Retail Cost Retail $165,000 $220,000 690,000 888,000 $680,000 $1,069,000 4,500 5,150 4,800 2,000 5,600 4,075 6,600 10,600 4,450 640,000 7,400 710,000 21,000 21,000 3,800 2,000 1.00 1.25 1.25 Required: 1. Estimate the 2021 and 2022 ending inventory and cost of goods sold using the dollar-value LIFO retail method. Answer is complete but not entirely correct. 2021 $434,950 2022 $ 764,825 Estimated ending inventory at retail Estimated ending inventory at cost Estimated cost of goods sold $ 220.000 $ 220,000 S 165,000 $ 165,000
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