Presented below is information related to Ricky Henderson Company. Compute the i

Question

Presented below is information related to Ricky Henderson Company.

Compute the inventory by the conventional retail inventory method. (Round ratios for computational purposes to 0 decimal places, e.g. 78% and final answer to 0 decimal places, e.g. 28,987.)

Ending Inventory using conventional retail Method __________________?

Cost Retail Beginning Inventory $247,288 $294,700 Purchases 1,464,000 2,144,000 Markups 95,500 Markup Cancellations 17,600 Markdowns 37,700 Markdown Cancellation 7,200 Sales Revenue 2,310,000

Explanation / Answer

Cost to retail ratio = 1781288 / 2516600

= 71%

Ending inventory at cost = 176100 * 71%

= $ 125031

Cost Retail Beginning Inventory        247,288           294,700 Purchases     1,464,000       2,144,000 Totals     1,711,288       2,438,700 Add: Net Markups Markups           95,500 Markup cancellations         (17,600)             77,900 Totals     1,711,288       2,516,600 Deduct: Net Markdowns Markdowns           37,700 Markdowns cancellation           (7,200)             30,500 Sale price of goods available       2,486,100 Deduct: Sales       2,310,000 Ending Invetory in retail           176,100

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