Question: The records of Nilson Company provide the following information for the year ended December 31.
At Cost At Retail
January 1 beginning inventory . . . . . . . . . $ 471,350 $ 927,150
Cost of goods purchased . . . . . . . . . . . . 3,276,030 6,279,350
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,495,700
Sales returns . . . . . . . . . . . . . . . . . . . . . . 44,600
Required: 1. Use the retail inventory method to estimate the company's year-end inventory at cost.
2. A year-end physical inventory at retail prices yields a total inventory of $1,675,800. Prepare a calculation showing the company's loss from shrinkage at cost and at retail.