The records for the Clothing Department of Sharapova’s Discount Store are summarized
below for the month of January.
At Retail At Cost
Inventory, January 1 $ 25,000 17,000
Purchases in January 137,000 82,500
Freight-in 7,000
Purchase returns 3,000 2,300
Transfers in from suburban branch 13,000 9,200
Inventory losses due to normal breakage, etc. 400
Sales revenue 95,000
Sales returns 2,400
Net markups $ 8,000
Net markdowns 4,000
Instructions
a. Compute the inventory for this department as of January 31, at retail prices.
b. Compute the ending inventory using lower-of-average-cost-or-market.
NOTE: Enter a formula, a cell reference, or a value (if you are unable to reference a cell), into the yellow shaded input cells.
a. Cost Retail
Cost-to-retail ratio
b. Ending inventory at lower-of-average-cost-or-market
