Herm9
Jul 19, 2008, 01:21 PM
I have the correct answer for #1 but can anyone explain what they are asking me to do on #2? There are no examples in my book for this. Thanks
Retail inventory method P4
The records of Alaina Co. provide the following information for the year ended
December 31:
At Cost At Retail
January 1 beginning inventory.. . $ 81,670 $114,610
Cost of goods purchased.. . 492,250 751,730
Sales.. . 786,120
Sales returns.. . 4,480
Required
1. Use the retail inventory method to estimate the company’s year-end inventory.
2. A year-end physical inventory at retail prices yields a total inventory of $78,550. Prepare a calculation showing the company’s loss from shrinkage at cost and at retail.
Retail inventory method P4
The records of Alaina Co. provide the following information for the year ended
December 31:
At Cost At Retail
January 1 beginning inventory.. . $ 81,670 $114,610
Cost of goods purchased.. . 492,250 751,730
Sales.. . 786,120
Sales returns.. . 4,480
Required
1. Use the retail inventory method to estimate the company’s year-end inventory.
2. A year-end physical inventory at retail prices yields a total inventory of $78,550. Prepare a calculation showing the company’s loss from shrinkage at cost and at retail.