On January 1, 2021, Sanderson Variety Store adopted the dollar-value LIFO retail inventory method. Accounting records provided the following information: Cost Retail Beginning inventory $ 57,000 $ 76,000 Net purchases 224,840 310,000 Net markups 8,000 Net markdowns 10,000 Net sales 287,000 Retail price index, end of year 1.02 Estimate ending inventory using the dollar-value LIFO retail method. (Round ratio calculation to 2 decimal places (i.e., 0.1234 should be entered as 12.34%.)) Cost Retail Cost-to-retail Ratio Beginning inventory $57,000 $76,000 Plus: Net purchases 224,840 310,000 Net markups 8,000 Less: Net markdowns (10,000) Goods available for sale (excluding beginning inventory) 224,840 308,000 Goods available for sale (including beginning inventory) 281,840 384,000 Base layer cost-to-retail percentage 75.00%selected answer correct 2021 layer cost-to-retail percentage 73.00%selected answer correct Less: Net sales (287,000) Estimated ending inventory at current year retail prices $97,000 Estimated ending inventory at cost ? Estimated cost of goods sold ?

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

Chapter7: Inventories: Cost Measurement And Flow Assumptions

Section: Chapter Questions

Problem 11RE: Jessie Stores uses the periodic system of calculating inventory. The following information is...

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Question

On January 1, 2021, Sanderson Variety Store adopted the dollar-value LIFO retail inventory method. Accounting records provided the following information:

	Cost		Retail
Beginning inventory	$	57,000		$	76,000
Net purchases		224,840			310,000
Net markups					8,000
Net markdowns					10,000
Net sales					287,000
Retail price index, end of year					1.02

Estimate ending inventory using the dollar-value LIFO retail method. (Round ratio calculation to 2 decimal places (i.e., 0.1234 should be entered as 12.34%.))

Cost	Retail	Cost-to-retail Ratio
Beginning inventory	$57,000	$76,000
Plus: Net purchases	224,840	310,000
Net markups		8,000
Less: Net markdowns		(10,000)
Goods available for sale (excluding beginning inventory)	224,840	308,000
Goods available for sale (including beginning inventory)	281,840	384,000

Base layer cost-to-retail percentage			75.00%selected answer correct
2021 layer cost-to-retail percentage			73.00%selected answer correct

Less: Net sales		(287,000)
Estimated ending inventory at current year retail prices		$97,000
Estimated ending inventory at cost	?
Estimated cost of goods sold	?