Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following information applies to the questions displayed below.] Sparrow Company uses the retail inventory method to estimate ending inventory and cost of goods sold.

The following information applies to the questions displayed below.] Sparrow Company uses the retail inventory method to estimate ending inventory and cost of goods sold. Data for 2021 are as follows:

Cost Retail
Beginning inventory $ 92,000 $ 182,000
Purchases 360,000 582,000
Freight-in 9,200
Purchase returns 7,200 11,200
Net markups 16,200
Net markdowns 12,200
Normal spoilage 3,200
Abnormal spoilage 4,840 8,200
Sales 542,000
Sales returns 10,200

The company records sales net of employee discounts. Employee discounts for 2021 totaled $4,200.

Required: 1. Estimate Sparrows ending inventory and cost of goods sold for the year using the retail inventory method and the average cost application. (Round Cost-to-retail percentage to 2 decimal places and final answers to the nearest whole dollar amount.)

ESTIMATED ENDING INVENTORY AT RETAIL-

ESTIMATED ENDING INVENTORY AT COST-

ESTIMATED COST OF GOODS SOLD-

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting Theory And Analysis Text Reading And Cases

Authors: Richard G. Schroeder, Jack M. Cathey, Myrtle W. Clark

7th Edition

0471379549, 9780471379546

More Books

Students also viewed these Accounting questions

Question

Why are value-added activities defined from a customer viewpoint?

Answered: 1 week ago

Question

98. For a compound random variable S = N i=1 Xi , find Cov(N, S).

Answered: 1 week ago