**EXERCISE 6-10
Purpose: | (L.O. 8) This exercise illustrates the use of the retail inventory method to estimate ending inventory. |
The records of Petite Clothiers report the following figures for the month of September:
Sales | $79,000 |
Sales returns | 1,000 |
Freight on purchases | 2,400 |
Purchases (at cost) | 48,000 |
Purchases (at sales price) | 92,000 |
Purchase returns (at cost) | 2,000 |
Purchase returns (at sales price) | 3,000 |
Beginning inventory (at cost) | 30,000 |
Beginning inventory (at sales price) | 51,000 |
Instructions
Compute an estimate of the cost of ending inventory by using the retail inventory method.
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