Data below for the year ended December 31, 2018, relates to
Houdini Inc. Houdini started business January 1, 2018, and uses the
LIFO retail method to estimate ending inventory.
Cost | Retail | |||||
Beginning inventory | $ | 76,000 | $ | 114,000 | ||
Net purchases | 355,000 | 520,000 | ||||
Net markups | 30,000 | |||||
Net markdowns | 50,000 | |||||
Net sales | 465,000 | |||||
Estimated ending inventory at retail is:
Multiple Choice
$35,000.
$85,000.
$149,000.
$197,280.
Willie Nelson's Boots uses the conventional retail method to
estimate ending inventory. Cost data for the most recent quarter is
shown below:
Cost | Retail | |||||
Beginning inventory | $ | 57,000 | $ | 74,000 | ||
Net purchases | 165,000 | 237,000 | ||||
Net markups | 33,000 | |||||
Net markdowns | 46,000 | |||||
Net sales | 231,000 | |||||
The conventional cost-to-retail percentage (rounded) is:
Multiple Choice
84.1%.
71.4%.
64.5%.
74.5%
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