Required information [The following information applies to the questions displayed below.] 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: Beginning inventory Purchases Purchase returns Freight-in Net markups Net markdowns Net sales to customers Sales to employees (net of 30% discount) Normal spoilage Price Index: January 1, 2024 December 31, 2024 December 31, 2025 2024 2025 Cost Retail Cost Retail $ 102,300 $ 165,000 484,000 2,800 5,000 715,000 1,500 $ 625,000 2,500 8,000 $ 974,000 6,100 5,500 8,400 4,000 6,300 634,000 660,000 11,900 11,900 5,200 4,100 1.00 1.25 1.25