Question

Campbell Corporation uses the retail method to value its inventory. The following information is available for the year 2018 5 Retail Merchandise inventory, January 1, 2018 Purchases Freight-in Net markups Net markdowns Net sales $300,000 $291,000 581,000 928,009 19,000 15 points 31,000 5,000 910,000 Skipped Required Determine the December 31, 2018, inventory by applying the conventional retail method. eBook t-to Cost Retail Beginning inventory Plus: Purchases Print Freight-in Net markups Less Net markdowns Goods available for sale Cost-to-retail percentage Less Net sales Estimated ending inventory at retail Estimated ending inventory at cost

Answer 1

As per policy, only one question is allowed to answer at a time, so answering Q5 here :

5)

Inventory on Dec 31, 2018:
	Cost	Retail	Cost to Retail ratio	Calculation
Beginning inventory	300000	291000
add: Purchases	581000	928000
add: Freight-in	19000
add: Net markups		31000
	900000	1250000
Less: Net markdowns		5000
Goods available for sale	900000	1245000
Cost to retail percentage			0.722891566	(900000/1245000)
Less:Net Sales		910000
Estimated endng inventory at retail		335000
Estimated ending inventory at cost	242168.82			(335000*0.722892)

Answer 2

net markup is 0, ratio is retail value before markdowns divided by cost value after markdowns, and then estimated inventory at cost is ending at retail times the ratio