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Question - Capital City Corporation uses the conventional retail inventory method to determine its ending inventory at cost. The following information is available for the current year:
Cost
Retail
Beginning Inventory
$350,000
$500,000
Purchases
$1,600,000
$2,440,000
Net Markups
$60,000
Net Markdowns
$30,000
Sales
$2,350,000
Capital City determines that the cost-to-retail ratio is 65%. What is the ending inventory at cost?
$620,000
$470,000
$403,000
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