Business, 02.12.2020 06:20 mustafajibawi1

Alquist Company uses the retail method to estimate its ending inventory. Selected information about its year 2021 operations is as follows: January 1, 2021, beginning inventory had a cost of $180,000 and a retail value of $230,000. Purchases during 2021 cost $1,802,000 with an original retail value of $2,695,000. Freight costs were $18,000 for incoming merchandise. Net additional markups were $200,000 and net markdowns were $295,000. Based on prior experience, shrinkage due to shoplifting was estimated to be $23,000 of retail value. Merchandise is sold to employees at a 20% of selling price discount. Employee sales are recorded in a separate account at the net selling price. The balance in this account at the end of 2021 is $330,000. Sales to customers totaled $2,100,000 for the year. Required: 1. Estimate ending inventory and cost of goods sold using the conventional retail method.

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Alquist Company uses the retail method to estimate its ending inventory. Selected information about...

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