Laura's Department Store uses the average cost retail inventory method to determine its ending inventory. The accounting records for the current year for Laura's contained the following information: CostRetailPurchases$71,200$87,750Beginning inventory17,00023,500Sales 98,000Net markups 6,500Net markdowns 3,000In addition, the accounting records for Laura's disclosed that purchases returns at cost and retail were $1,950 and $4,250, respectively. What is the cost-to-retail percentage to be used for ending inventory calculations?A 76.8%B 79.8%C 78.1%D 75.1%

Name: Laura's Department Store uses the average cost retail inventory method
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Description: Laura's Department Store uses the average cost retail inventory method to determine its ending inventory. The accounting records for the current year for Laura's contained the following information: CostRetailPurchases$71,200$87,750Beginning inventor

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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 14RE: On January 1 of Year 1, Dorso Company adopted the dollar-value LIFO method of inventory costing....

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Laura's Department Store uses the average cost retail inventory method to determine its ending inventory. The accounting records for the current year for Laura's contained the following information:

	Cost	Retail
Purchases	$71,200	$87,750
Beginning inventory	17,000	23,500
Sales		98,000
Net markups		6,500
Net markdowns		3,000

In addition, the accounting records for Laura's disclosed that purchases returns at cost and retail were $1,950 and $4,250, respectively. What is the cost-to-retail percentage to be used for ending inventory calculations?

A 76.8%

B 79.8%

C 78.1%

D 75.1%

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