Retail Inventory Method
Turner Corporation uses the retail inventory method. The following information for the current year is available:
Cost Retail Cost Retail
Inventory, January 1 $ 29,000 $ 45,000 Additional markups $ 50,000
Purchases (gross price) 140,000 190,000 Markup cancellations 10,000
Purchases discounts taken 3,000 Markdowns 15,000
Purchases returns 5,000 8,000 Markdown cancellations 3,000
Freiqht-in 20,000 Net Sales 190,000
Employee discounts 3,000
Required:
Compute the cost of the ending inventory using the conventional retail inventory method (round the cost-to-retail ratio to 3 decimal places).
TURNER CORPORATION
Calculation of Ending Inventory using the
Conventional Retail Inventory Method
Cost Retail
$ $
Ending inventory at retail
$
Ending inventory at LCM $ $