Alquist Company uses the retail method to estimate its ending inventory. Selected information about its year 2018 operations is as follows: a. January 1, 2018, beginning inventory had a cost of $312,000 and a retail value of $330,000. b. Purchases during 2018 cost $1,740,000 with an original retail value of $2,670,000. c. Freight costs were $28,000 for incoming merchandise. d. Net additional markups were $250,000 and net markdowns were $320,000. e. Based on prior experience, shrinkage due to shoplifting was estimated to be $33,000 of retail value. f. Merchandise is sold to employees at a 20% of selling price discount. Employee sales are recorded in a separate account at the net selling price. The balance in this account at the end of 2018 is $430,000. g. Sales to customers totaled $2,000,000 for the year.
Alquist Company uses the retail method to estimate its ending inventory. Selected information about its year 2018 operations is as follows: a. January 1, 2018, beginning inventory had a cost of $312,000 and a retail value of $330,000. b. Purchases during 2018 cost $1,740,000 with an original retail value of $2,670,000. c. Freight costs were $28,000 for incoming merchandise. d. Net additional markups were $250,000 and net markdowns were $320,000. e. Based on prior experience, shrinkage due to shoplifting was estimated to be $33,000 of retail value. f. Merchandise is sold to employees at a 20% of selling price discount. Employee sales are recorded in a separate account at the net selling price. The balance in this account at the end of 2018 is $430,000. g. Sales to customers totaled $2,000,000 for the year.
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter13: Accounting For Merchandise Inventory
Section: Chapter Questions
Problem 1MP: Hurst Companys beginning inventory and purchases during the fiscal year ended December 31, 20-2,...
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