Question

Wildhorse Inc. had beginning inventory of $13,140 at cost and $21,900 at retail. Net purchases were $119,770 at cost and $168,500 at retail. Net markups were $9,900, net markdowns were $7,300, and sales revenue was $139,000. Compute ending inventory at cost using the LIFO retail method. (Round ratios for computational purposes to 1 decimal place, e.g. 78.7% and final answer to 0 decimal places, e.g. 28,987.)

Answer 1

	Cost	Retail
Beginning Inventory	13140	21900
Net purchases	119770	168500
Total	132910	190400
Add: mark ups		9900
Total	132910	200,300
Less: mark downs		7300
Goods available for sale @ retail		193000
Less: Sales		139000
Ending Inventory at Retail		54000

Cost to Retail % -

Current Month = [132910 - 13140] / [ 193000 - 21900] = 70%

Ending Inventory at Cost -

Beginning inventory + current month cost

= 13140 + [ 70% * (54000 - 21900)]

= 13140 + 22470

=$ 35,610