Retail Inventory Method
Response to the following problem:
The following data were available from the records of the Hegge Department Store for the year ended December 31, 2010:
At Cost At Retail
Merchandise inventory, January 1, 2010: $ 90,000 $ 1 30,000
Purchases 330,000 460,000
Markups 10,000
Markdowns 40,000
Sales 480,000
Required:
Using the retail method, what is the estimate of the merchandise inventory at December 31, 2010 valued at the lower of cost or market?