401 Homework 9

# 401 Homework 9 - Homework 9 E9-1 9-18 9-20 9-22 P9-1 9-3...

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Homework 9 E9-1, 9-18, 9-20, 9-22 P9-1, 9-3 CA9-3 E9-1 Per Unit Lower-of- Part No. Quantity Cost Market Total Cost Total Market Cost-or-Market 110 600 \$ 95 \$100.00 \$ 57,000 \$ 60,000 \$ 57,000 111 1,000 60 52.00 60,000 52,000 52,000 112 500 80 76.00 40,000 38,000 38,000 113 200 170 180.00 34,000 36,000 34,000 120 400 205 208.00 82,000 83,200 82,000 121 1,600 16 0.50 25,600 800 800 122 300 240 235.00 72,000 70,500 70,500 Totals \$370,600 \$340,500 \$334,300 (a) \$334,300. (b) \$340,500. E9-18 (a) Cost Retail Beginning inventory ...................................................... \$ 58,000 \$100,000 Purchases ..................................................................... 122,000 200,000 Net markups ................................................................. 20,000 Totals .................................................................. \$180,000 320,000 Net markdowns ............................................................. (30,000 ) Sales price of goods available ...................................... 290,000 Deduct: Sales .............................................................. 186,000 Ending inventory at retail .............................................. \$104,000 (b) 1. \$180,000 ÷ \$300,000 = 60% 2. \$180,000 ÷ \$270,000 = 66.67% 3. \$180,000 ÷ \$320,000 = 56.25% 4. \$180,000 ÷ \$290,000 = 62.07%

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E9-18 (Continued) (c) 1. Method 3. 2. Method 3. 3. Method 3. (d) 56.25% X \$104,000 = \$58,500 (e) \$180,000 – \$58,500 = \$121,500 (f) \$186,000 – \$121,500 = \$64,500 E9-20 Cost Retail Beginning inventory ............................................. \$30,000 \$ 46,500 Purchases ............................................................ 55,000 88,000 Purchase returns ................................................. (2,000) (3,000) Freight on purchases ........................................... 2,400 _______ Totals ......................................................... 85,400 131,500 Add: Net markups Markups ................................................... \$10,000 Markup cancellations ............................... (1,500 ) Net markups ........................................................ _______ 8,500 Totals ......................................................... \$85,400 140,000 Deduct: Net markdowns Markdowns ............................................... 9,300 Markdown cancellations ........................... (2,800 ) Net markdowns .................................................... 6,500 Sales price of goods available ............................. 133,500 Deduct: Net sales (\$95,000 – \$2,000) ................. 93,000 Ending inventory, at retail .................................... \$ 40,500 Cost-to-retail ratio = \$85,400 = 61% \$140,000 Ending inventory at cost = 61% X \$40,500 = \$24,705 E9-22
(a) Conventional Retail Method

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