A retail shop needs to estimate the cost of its ending inventory for insurance purposes. Since it is Christmas, it cannot close for a physical count of inventory. The shop uses a periodic inventory system. The insurance company will accept an estimate using the retail method. The shop owner knows the cost of opening inventory was $125,000 from the previous year-end's physical count and its selling price was $180,000. From invoices, the owner knows the cost of purchases was $100,000 and the retail selling prices totalled $260,000. Cash register receipts show that sales from the beginning of the year totalled $250,000. What is the ending inventory under the retail method (round % to the nearest whole number)?
A retail shop needs to estimate the cost of its ending inventory for insurance purposes. Since it is Christmas, it cannot close for a physical count of inventory. The shop uses a periodic inventory system. The insurance company will accept an estimate using the retail method. The shop owner knows the cost of opening inventory was $125,000 from the previous year-end's physical count and its selling price was $180,000. From invoices, the owner knows the cost of purchases was $100,000 and the retail selling prices totalled $260,000. Cash register receipts show that sales from the beginning of the year totalled $250,000. What is the ending inventory under the retail method (round % to the nearest whole number)?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter22: Accounting For Changes And Errors.
Section: Chapter Questions
Problem 14E: Refer to the information in E22-13. Required: Prepare the correcting journal entries if the company...
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