The records of Shamrock's Boutique report the following data for the month of April. Sales revenue $100,100 Purchases

Question

The records of Shamrock's Boutique report the following data for the month of April. Sales revenue $100,100 Purchases (at cost) $47,400 Sales returns 1,900 Purchases (at sales price) 95,300 Markups 9,500 Purchase returns (at cost) 1,900 Markup cancellations 1,500 Purchase returns (at sales price) 2,900 Markdowns 9,800 Beginning inventory (at cost) 37,344 Markdown cancellations 2,800 Beginning inventory (at sales price) 48,800 Freight on purchases 2,200 Compute the ending inventory by the conventional retail inventory method.

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Let us compute the ending inventory at retail. The convention retail inventory method includes markups but excludes markdowns. Cost Retail Beginning inventory $37,344 $48,800 Purchases 47,400 95,300 Purchase returns (1,900) (2,900) Freight on purchases 2,200 Cost of goods available for sale 85,044 141,200 Markups 9,500 Markup cancellation (1,500 ) Sales revenue (100,100) Sales return 1,900 Ending inventory 51,000 Let us determine the cost-to-retail ratio. Costtoretailratio=CostofgoodsavailableforsaleatcostCostofgoodsavailableforsaleatretail×100Costtoretailratio=85,044141,200×100Costtoretailratio=60.2% The cost-to-retail ratio is 60.2%. Now, we can determine the ending inventory at cost. Endinginventoryatcost=Endinginventoryatretail×CosttoretailratioEndinginventoryatcost=51,000×60.2%Endinginventoryatcost=30,702 The ending inventory at cost is $30,702.

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The records of Shamrock's Boutique report the following data for the month of April

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Sales revenue	$100,100	Purchases (at cost)	$47,400
Sales returns	1,900	Purchases (at sales price)	95,300
Markups	9,500	Purchase returns (at cost)	1,900
Markup cancellations	1,500	Purchase returns (at sales price)	2,900
Markdowns	9,800	Beginning inventory (at cost)	37,344
Markdown cancellations	2,800	Beginning inventory (at sales price)	48,800
Freight on purchases	2,200

	Cost	Retail
Beginning inventory	$37,344	$48,800
Purchases	47,400	95,300
Purchase returns	(1,900)	(2,900)
Freight on purchases	2,200
Cost of goods available for sale	85,044	141,200
Markups		9,500
Markup cancellation		(1,500 )
Sales revenue		(100,100)
Sales return		1,900
Ending inventory		51,000