! Required information Problem 9-7 (Algo) Retail inventory method; conventional and LIFO [LO9-3, 9-4] [The following information applies to the questions displayed below.] Alquist Company uses the retail method to estimate its ending inventory. Selected information about its year 2021 operations is as follows: a. January 1, 2021, beginning inventory had a cost of $210,000 and a retail value of $260,000. b. Purchases during 2021 cost $1,467,000 with an original retail value of $2,330,000. c. Freight costs were $21,000 for incoming merchandise. d. Net additional markups were $240,000 and net markdowns were $170,000. e. Based on prior experience, shrinkage due to shoplifting was estimated to be $26,000 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 2021 is $360,000. g. Sales to customers totaled $1,860,000 for the year. Problem 9-7 (Algo) Part 2 Required: 2. Estimate ending inventory and cost of goods sold using the LIFO retail method. (Assume stable prices.) Estimated ending inventory at retail Estimated ending inventory at cost Estimated cost of goods sold $ LIFO Retail Method 210,100
! Required information Problem 9-7 (Algo) Retail inventory method; conventional and LIFO [LO9-3, 9-4] [The following information applies to the questions displayed below.] Alquist Company uses the retail method to estimate its ending inventory. Selected information about its year 2021 operations is as follows: a. January 1, 2021, beginning inventory had a cost of $210,000 and a retail value of $260,000. b. Purchases during 2021 cost $1,467,000 with an original retail value of $2,330,000. c. Freight costs were $21,000 for incoming merchandise. d. Net additional markups were $240,000 and net markdowns were $170,000. e. Based on prior experience, shrinkage due to shoplifting was estimated to be $26,000 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 2021 is $360,000. g. Sales to customers totaled $1,860,000 for the year. Problem 9-7 (Algo) Part 2 Required: 2. Estimate ending inventory and cost of goods sold using the LIFO retail method. (Assume stable prices.) Estimated ending inventory at retail Estimated ending inventory at cost Estimated cost of goods sold $ LIFO Retail Method 210,100
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
Chapter8: Inventories: Special Valuation Issues
Section: Chapter Questions
Problem 15P: (Appendix 8.1) Inventory Write-Down The following are the inventories for the years 2019, 2020, and...
Related questions
Topic Video
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College