Dixon Books uses the retail inventory method to estimate its monthly ending inventories. The following information is available for two of its departments at October 31, 2015.
At December 31, Dixon Books takes a physical inventory at retail. The actual retail values of the inventories in each department are Hardcovers $1,192,900, and Paperbacks $505,850.
1. Determine the cost-to-retail ratio. (Round answers to 1 decimal place, e.g. 25.5%.)
Hardcovers: ___%
Paperbacks: ___%
2. Determine the estimated cost of the ending inventory for each department atOctober 31, 2015, using the retail inventory method. (Round answers to 0 decimal place, e.g. 25,120.)
Hardcovers: ___$
Paperbacks: ___$
3.Compute the ending inventory at cost for each department at December 31, assuming the cost-to-retail ratios for the year are 68% for Hardcovers and 77% for Paperbacks. (Round answers to 0 decimal places, e.g. 25,120.)
Hardcovers: ___$
Paperbacks: ___$