Estimate sparrows ending inventory and cost of goods sold

Reference no: EM13597851

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 $

Reference no: EM13597851

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