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Retail Inventory Method Harmes Company is a clothing store that uses the retail inventory method. The following information relates to its operations during 2016: Cost

Retail Inventory Method

Harmes Company is a clothing store that uses the retail inventory method. The following information relates to its operations during 2016:

Cost Retail
Inventory, January 1 $28500 $41200
Purchases 67200 102300
Markups (net) 1700
Markdowns (net) 500
Sales 86200

Required:

1. Compute the ending inventory by the retail inventory method for the following cost flow assumption: FIFO. Round the cost-to-retail ratio to three decimal places. If necessary, round dollar amounts to the nearest whole dollar.

HARMES COMPANY
Calculation of ending inventory by retail inventory method
FIFO 2016
Cost Retail
$ $
$ $
$ $
$
$

2. Compute the ending inventory by the retail inventory method for the following cost flow assumption: Average cost. Round the cost-to-retail ratio to three decimal places. If necessary, round dollar amounts to the nearest whole dollar.

HARMES COMPANY
Calculation of ending inventory by retail inventory method
Average Cost 2016
Cost Retail
$ $
$ $
$
$

3. Compute the ending inventory by the retail inventory method for the following cost flow assumption: LIFO. Round the cost-to-retail ratio to three decimal places. If necessary, round dollar amounts to the nearest whole dollar.

HARMES COMPANY
Calculation of ending inventory by retail inventory method
LIFO 2016
Cost Retail
$ $
$
$ $
$
Ending inventory at LIFO cost
Beginning layer (as stated in data) $28500
New layer
Total $

4. Compute the ending inventory by the retail inventory method for the following cost flow assumption: Lower of cost or market (based on average cost). Round the cost-to-retail ratio to three decimal places. If necessary, round dollar amounts to the nearest whole dollar.

HARMES COMPANY
Calculation of ending inventory by retail inventory method
Lower of Cost or Market (based on average cost) 2016
Cost Retail
$ $
$ $
$
$

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