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  • Nov 27, 2011, 03:08 PM
    edadams
    accounting
    On January 1, 2011, Pet Friendly Stores adopted the retail inventory method. Inventory transactions at both cost and retail, and cost indexes for 2011 and 2012 are as follows:

    2011 2012
    Cost Retail Cost Retail
    Beginning inventory $ 90,000 $ 150,000
    Purchases 478,000 730,000 511,000 760,000
    Purchase returns 2,500 3,500 2,200 4,000
    Freight-in 6,960 8,000
    Net markups 8,500 10,000
    Net markdowns 4,000 6,000
    Net sales to customers 650,000 680,000
    Sales to employees (net of 30% discount) 14,000 17,500
    Normal spoilage 5,000 6,600
    Price Index:
    January 1, 2011 1.00
    December 31, 2011 1.03
    December 31, 2012 1.06

    Required:
    (1)

    Estimate the 2011 and 2012 ending inventory and cost of goods sold using the dollar-value LIFO retail method. (Round the cost-to-retail percentage to 2 decimal places (e.g. 12.34%) for calculation purposes. Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)

    2011 2012
    Estimated ending inventory at cost $ $
    Estimated cost of goods sold $ $

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