Question
Duke Co. uses the retail inventory method to estimate ending inventory and cost of goods sold. Data for the year 2016 is as follow:
The company records sales net of employee discounts.
Required:
Estimate Duke's ending inventory and cost of goods sold for the year using the retail inventory method and the following applications:
1. Average Cost
2. Conventional
3. LIFO
|
|
Cost |
retail |
|
Beginning inventory |
$140,000 |
$280,000 |
|
Purchases |
420,000 |
690,000 |
|
Freight in |
16,000 |
|
|
Purchase Returns |
12,000 |
18,000 |
|
Net markups |
|
24,000 |
|
Net markdowns |
|
36,000 |
|
Normal spiolage |
|
5,000 |
|
Sales |
|
700,000 |
|
Sales returns |
|
20,000 |
|
Employees discounts |
|
6,000 |
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