The records of Hot’s Department Store report the following data for the month of January: Beginning inventory at costP 440,000Beginning inventory at sales price800,000Purchases at cost4,500,000Initial markup on purchases2,900,000Purchase returns at cost240,000Purchase returns at sales price350,000Freight on purchases100,000Additional markup250,000Markup cancellations100,000Markdown600,000Markdown cancellations100,000 Net sales6,500,000Sales allowance100,000Sales returns500,000Employee discounts200,000Theft and other losses100,000 Using the average retail inventory method, Hot’s ending inventory at cost is

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Description: The records of Hot’s Department Store report the following data for the month of January: Beginning inventory at costP 440,000Beginning inventory at sales price800,000Purchases at cost4,500,000Initial markup on purchases2,900,000Purchase returns at

Retail Inventory Method : In calculates the ending inventory value by finding the total value of…

Answered: The records of Hot’s Department Store…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 46E

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The records of Hot’s Department Store report the following data for the month of January:

Beginning inventory at cost	P 440,000
Beginning inventory at sales price	800,000
Purchases at cost	4,500,000
Initial markup on purchases	2,900,000
Purchase returns at cost	240,000
Purchase returns at sales price	350,000
Freight on purchases	100,000
Additional markup	250,000
Markup cancellations	100,000
Markdown	600,000
Markdown cancellations	100,000

Net sales	6,500,000
Sales allowance	100,000
Sales returns	500,000
Employee discounts	200,000
Theft and other losses	100,000

Using the average retail inventory method, Hot’s ending inventory at cost is

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