Essay Marketing

600 Words Jun 22nd, 2015 3 Pages
ASSIGNMENT # 4: FINANCIALS
Due via email by: Sunday, November 16th (11:59pm)
Please show your work – either by hand and scanned in or you can use a program like Excel or Word. If you show your work, I can give you partial credit for incorrect answers.
Question # 1:
A retailer has yearly sales of $650,000. Inventory on January 1 is $260,000 (at cost). During the year, $500,000 of merchandise (at cost) is purchased. The ending inventory is $275,000 (at cost). Operating costs are $90,000.
a. Calculate the cost of goods sold
b. Calculate the net profit
Question # 2:
A retailer has a beginning monthly inventory valued at $60,000 at retail and $35,000 at cost. Net purchases during the month are $140,000 at retail and $70,000 at cost.
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Ending retail book value of inventory – physical inventory at retail
Total merchandise available (at cost) =
Beginning monthly inventory + Net purchases + transportation charges
Total merchandise available (at retail) = Beginning monthly inventory + Net purchases
Adjusted ending retail book value of inventory = adjusted the value of the retail book value of inventory to reflect the actual physical inventory on hand. This adjusts your books to match what you actually have at the store.
Markups can be computed on the basis of retail selling price or cost but are typically calculating using the retail price. Why? (1) Retail expenses, markdowns and profit are always stated as a percentage of sales. Thus, markups expressed as a percentage of sales are more meaningful. (2) Manufacturers quote selling prices and discounts to retails as percentage reductions from retail list prices. (3) Retail price data are more…

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