Question
Please help me with the estimated ending inventory at cost and the cost of goods sold. I've got the ending inventory at retail correct. On
Please help me with the estimated ending inventory at cost and the cost of goods sold. I've got the ending inventory at retail correct.
On January 1, 2024, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2024 and 2025 are as follows:
| 2024 | 2025 | |||
|---|---|---|---|---|
| Cost | Retail | Cost | Retail | |
| Beginning inventory | $ 165,000 | $ 220,000 | ||
| Purchases | 690,000 | 888,000 | $ 680,000 | $ 1,069,000 |
| Purchase returns | 4,500 | 5,150 | 2,000 | 4,075 |
| Freight-in | 4,800 | 5,600 | ||
| Net markups | 6,600 | 10,600 | ||
| Net markdowns | 4,450 | 7,400 | ||
| Net sales to customers | 640,000 | 710,000 | ||
| Sales to employees (net of 25% discount) | 21,000 | 21,000 | ||
| Normal spoilage | 3,800 | 2,000 | ||
| Price Index: | ||||
| January 1, 2024 | 1.00 | |||
| December 31, 2024 | 1.25 | |||
| December 31, 2025 | 1.25 | |||
Required:
2. Estimate the 2024 ending inventory and cost of goods sold using the average cost retail method.
Note: Round your cost-to-retail percentage to 2 decimal places and round your final answers to nearest whole dollar.
| Average Cost Retail Method | |
| Estimated ending inventory at retail | $433,200 |
| Estimated ending inventory at cost | |
| Estimated cost of goods sold |
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