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Business Accounting INTERMEDIATE ACCOUNTING

Retail inventory method : It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail. To prepare: a report to the president explaining about the retail method of estimating inventories.

Retail inventory method : It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail. To prepare: a report to the president explaining about the retail method of estimating inventories.

Solution Summary: The author explains the retail method of estimating inventories. It eliminates the time taken for the physical inventory count and is considered for financial reporting and income tax purposes.

INTERMEDIATE ACCOUNTING

INTERMEDIATE ACCOUNTING

8th Edition

ISBN: 9780078025839

Author: J. David Spiceland

Publisher: McGraw-Hill Education

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Chapter 9, Problem 9.5BYP

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Retail inventory method: It takes into account all the retail amounts that is, the current selling prices. Under this method, the goods available for sale, at retail is deducted from the sales, at retail to determine the ending inventory, at retail.

To prepare: a report to the president explaining about the retail method of estimating inventories.

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Chapter 9, Problem 9.4BYP

Chapter 9, Problem 9.6BYP

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Chapter 9 Solutions

INTERMEDIATE ACCOUNTING

Ch. 9 - Prob. 9.1Q Ch. 9 - Prob. 9.2Q Ch. 9 - Describe the alternative approaches for recording...Ch. 9 - Explain the gross profit method of estimating...Ch. 9 - The Rider Company uses the gross profit method to...Ch. 9 - Explain the retail inventory method of estimating...Ch. 9 - Both the gross profit method and the retail...Ch. 9 - Define each of the following retail terms: initial...Ch. 9 - Explain how to estimate the average cost of...Ch. 9 - Prob. 9.10Q

Ch. 9 - Explain the LIFO retail inventory method.Ch. 9 - Discuss the treatment of freight-in, net markups,...Ch. 9 - Explain the difference between the retail...Ch. 9 - Prob. 9.14Q Ch. 9 - Prob. 9.15Q Ch. 9 - Explain the accounting treatment of material...Ch. 9 - Prob. 9.17Q Ch. 9 - Identify any differences between U.S. GAAP and...Ch. 9 - (Based on Appendix 9) Define purchase commitments....Ch. 9 - (Based on Appendix 9) Explain how purchase...Ch. 9 - Lower of cost or net realizable value LO91 Ross...Ch. 9 - Lower of cost or net realizable value LO91 SLR...Ch. 9 - Prob. 9.3BE Ch. 9 - Gross profit method; solving for unknown LO92...Ch. 9 - Prob. 9.5BE Ch. 9 - Prob. 9.6BE Ch. 9 - Prob. 9.7BE Ch. 9 - Prob. 9.8BE Ch. 9 - Prob. 9.9BE Ch. 9 - Prob. 9.10BE Ch. 9 - Prob. 9.11BE Ch. 9 - Prob. 9.12BE Ch. 9 - Prob. 9.13BE Ch. 9 - Prob. 9.14BE Ch. 9 - Lower of cost or net realizable value LO91 Herman...Ch. 9 - Prob. 9.2E Ch. 9 - Prob. 9.3E Ch. 9 - Prob. 9.5E Ch. 9 - Prob. 9.6E Ch. 9 - Prob. 9.7E Ch. 9 - Gross profit method LO92 Royal Gorge Company uses...Ch. 9 - Prob. 9.9E Ch. 9 - Prob. 9.10E Ch. 9 - Prob. 9.11E Ch. 9 - Prob. 9.12E Ch. 9 - Prob. 9.13E Ch. 9 - Prob. 9.14E Ch. 9 - Prob. 9.15E Ch. 9 - Prob. 9.16E Ch. 9 - Prob. 9.17E Ch. 9 - Prob. 9.18E Ch. 9 - Prob. 9.19E Ch. 9 - Prob. 9.20E Ch. 9 - Prob. 9.21E Ch. 9 - Prob. 9.22E Ch. 9 - E9–23 Inventory errors • LO9–7 For each of the...Ch. 9 - Prob. 9.24E Ch. 9 - Prob. 9.25E Ch. 9 - Concepts; terminology LO91 through LO97 Listed...Ch. 9 - Prob. 9.27E Ch. 9 - Prob. 9.28E Ch. 9 - Prob. 1CPA Ch. 9 - Prob. 2CPA Ch. 9 - Prob. 3CPA Ch. 9 - Prob. 4CPA Ch. 9 - Prob. 5CPA Ch. 9 - Prob. 1CMA Ch. 9 - Prob. 2CMA Ch. 9 - Prob. 3CMA Ch. 9 - Prob. 9.1P Ch. 9 - Prob. 9.2P Ch. 9 - Prob. 9.3P Ch. 9 - Prob. 9.4P Ch. 9 - Prob. 9.5P Ch. 9 - Prob. 9.6P Ch. 9 - Prob. 9.7P Ch. 9 - Prob. 9.8P Ch. 9 - Prob. 9.9P Ch. 9 - Prob. 9.10P Ch. 9 - Prob. 9.11P Ch. 9 - P9–12 Charge in methods • LO9–6 Rockwell...Ch. 9 - Prob. 9.13P Ch. 9 - Prob. 9.14P Ch. 9 - Prob. 9.15P Ch. 9 - Prob. 9.16P Ch. 9 - Judgment Case 9–1 Inventoriable costs: lower of...Ch. 9 - Integrating Case 9–3 Unit LIFO and lower of cost...Ch. 9 - Prob. 9.4BYP Ch. 9 - Prob. 9.5BYP Ch. 9 - Prob. 9.6BYP Ch. 9 - Prob. 9.7BYP Ch. 9 - Prob. 9.8BYP Ch. 9 - Prob. 9.9BYP Ch. 9 - Judgment Case 910 Inventory errors LO97 Some...Ch. 9 - Prob. 9.11BYP Ch. 9 - Prob. 9.12BYP Ch. 9 - Prob. 1AFKC

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Inventory ratios for Dell and HP Dell Inc. and Hewlett-Packard Development Company, L.P. (HP) are both manufacturers of computer equipment and peripherals. However, the two companies follow two different strategies. Dell follows primarily a build-to-order strategy, where the consumer orders the computer from a Web page. The order is then manufactured and shipped to the customer within days of the order. In contrast, HP follows a build-to-stock Strategy, where the computer in first built for inventory, then sold from inventory to retailers, such as Best Buy. The two strategies can be seen in the difference between the inventory turnover and number of days sales in inventory ratios for the two companies. The following financial statement information is provided for Dell and HP for a recent fiscal year (in millions): Dell HP Inventory, beginning of period 1,301 7,490 Inventory, end of period 1,404 6,317 Cost of goods sold 48,260 92,385 a. Determine the inventory turnover ratio and the number of days sales in inventory ratio for each company. Use 365 days and round to one decimal place. b. Interpret the difference between the ratios for the two companies.

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