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Estimating Inventory Using Retail Inventory Method Conventional Retail-Mart values its inventory using the conventional retai

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Ending Inventory using conventional retail inventory method

$          48,300.00

--Working

Conventional Retail Method

Cost

Retail

Cost to Retail Ratio

Working

Beginning Inventory

$          53,800.00

$          80,000.00

Plus: Purchases

$        173,200.00

$        223,600.00

Purchase Returns

$          (3,000.00)

$          (3,600.00)

           Net Markups

$          20,000.00

$        224,000.00

$       320,000.00

Less: Net MarkDowns

$          11,000.00

Goods Available for sale

$        224,000.00

$        309,000.00

Cost to retail Percentage

70.00%

( 224000 / 320000 ) x 100

Less: Net Sales

$        240,000.00

Estimated ending inventory at retail

$          69,000.00

309000 - 240000

Estimated ending Inventory at cost

$          48,300.00

69000 x 70%

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