Sparrow Company uses the retail inventory method to estimate ending inventory and cost of goods sold. Data for 2011 are as follows:
Cost Retail
- Beginning inventory $ 80,000 $ 160,000
- Purchases 323,000 516,800
- Freight-in 9,100
- Purchase returns 6,700 10,300
- Net markups 16,500
- Net markdowns 11,300
- Normal spoilage 2,800
- Abnormal spoilage 4,400 7,800
- Sales 475,456
- Sales returns 10,200
The company records sales net of employee discounts. Discounts for 2011 totaled $3,700.
Required:
(1) Estimate Sparrow's ending inventory and cost of goods sold for the year using the retail inventory method and the average cost application.(Round the cost-to-retail percentage to 2 decimal places (e.g. 12.34%) for calculation purposes. Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)
- Ending inventory at retail $
- Ending inventory at cost $
- Estimated cost of goods sold $
(2) Estimate Sparrow's ending inventory and cost of goods sold for the year using the retail inventory method and the conventional (average, LCM) application. (Round the cost-to-retail percentage to 2 decimal places (e.g. 12.34%) for calculation purposes. Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)
- Ending inventory at retail $
- Ending inventory at cost $
- Estimated cost of goods sold $