Phillips Supply uses a periodic inventory system but needs to determine the approximate amount of inventory at the end of each month without taking a physical inventory. Phillips has provided the following inventory data:

	Cost Price	Retail Selling Price
Inventory of merchandise, June 3o	$300,000	$500,000
Purchases during July	$222,000	$400,000
Goods available for sale during July	$522,000	$900,000
Net sales during July		$600,000

a. Estimate the cost of goods sold and the cost of the July 31 ending inventory using the retail method of evaluation.

b. Was the cost of Phillip's inventory, as a percentage of retail selling prices, higher or lower in July than it was in June? Explain