(3) Floor Designated Market Value [Middle value of (1), (2) & (3)] $ 12,000 8,800 2,160 800 6,630 $ 30,390
Correct!
(4)
(5)
Product A B C D E
Inventory Value [Lower of (4) and (5)] $ 10,000 8,800 1,800 800 6,630 $ 28,030
Correct!
Inventory carrying value: Requirement 2: Inventory carrying value: Loss from inventory write-down:
28,030
- Correct!
$ $
30,390 3,210
- Correct!
Given Data P09-01: THE DECKER COMPANY Unit Selling Price $16 18 8 6 13 15% 40%
Product A B C D E
Unit RC $12 11 2 4 12
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 09-05 Requirement 1: ALQUIST COMPANY Conventional Retail Method Cost 100,000 1,387,500 10,000 Retail 150,000 2,000,000 300,000 2,450,000 61.12% (150,000) 2,300,000 (15,000) 1,750,000 250,000
Beginning inventory Plus: Purchases Freight-in Plus: Net markups Cost-to-retail percentage: Less: Net markdowns Goods available for sale Less: Normal shrinkage Sales: Sales to customers Sales to employees Employee discounts Estimated ending inventory at retail Estimated ending inventory at cost Estimated cost of goods sold
1,497,500
- Correct!
Requirement 2: ALQUIST COMPANY LIFO Retail Method Cost 100,000 1,387,500 10,000 Retail 150,000 2,000,000 300,000 (150,000) 2,150,000 2,300,000
Beginning inventory Plus: Purchases Freight-in Plus: Net markups Less: Net markdowns Goods available for sale (excluding beg. inv.) Goods available for sale (including beg. inv.) Cost to retail percentage: Less: Normal shrinkage Sales: Sales to customers Sales to employees Employee discounts Estimated ending inventory at retail Estimated ending inventory at cost: Beginning inventory Current period's layer Total Estimated cost of goods sold
- Correct!
$ $
$ $
(147,125) $ 1,350,375
- Correct!
Given Data P09-05: ALQUIST COMPANY 2011 operations information: Beginning inventory cost, 1/1/2011 Beginning inventory retail value, 1/1/2011 2011 Purchases cost 2011 Purchases retail value Incoming freight costs Outgoing freight costs Net additional. markups Net markdowns Shrinkage estimate Employee discount Employee sales Customer sales $ 100,000 $ 150,000 $ 1,387,500 $ 2,000,000 $ 10,000 $ 25,000 $ 300,000 $ 150,000 $ 15,000 20% $ 250,000 $ 1,750,000
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 09-06 Requirement 1: GRAND DEPARTMENT STORE, INC. Conventional Retail Method Cost 20,000 $ 100,151 5,100 (2,100) Retail 30,000 146,495 (2,800) 2,235 175,930
Beginning inventory Plus: Purchases Freight-in Less: Purchase returns Plus: Net markups Cost-to-retail percentage: Less: Net markdowns Goods available for sale Less: Normal spoilage Net sales Estimated ending inventory at retail Estimated ending inventory at cost 70.00%
123,151
Correct!
$ $ 24,430
Correct!
Requirement 2: The difference between the inventory estimate per retail method and the amount per the physical count may be due to: 1. Theft losses.
3. Differences in cost-to-retail percentage for purchases during the month, beginning inventory, and ending inventory. 4. Markups on goods available for sale inconsistent between cost of goods sold and ending inventory.
Given Data P09-06: GRAND DEPARTMENT STORE, INC. October, 2011 operations information: Beginning inventory at cost, 10/1/2011 Beginning inventory at retail, 10/1/2011 Purchases at cost Purchases at retail Freight-in Purchase returns at cost Purchase returns at retail Additional. markups Markup cancellations Net markdowns Normal spoilage and breakage Sales $ $ $ $ $ $ $ $ $ $ $ $ 20,000 30,000 100,151 146,495 5,100 2,100 2,800 2,500 265 800 4,500 135,730
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 09-10 Requirement 1: RALEIGH DEPARTMENT STORE Conventional Retail Method Cost 27,500 $ 282,000 26,500 (6,500) (5,000) Retail 45,000 490,000 (10,000) 25,000 550,000 59% (10,000) 540,000 (487,000) (3,000) 50,000
Correct!
Beginning inventory Plus: Purchases Freight-in Less: Purchase returns Purchase discounts Plus: Net markups Cost-to-retail percentage: Less: Net markdowns Goods available for sale Less: Net sales Employee discounts Estimated ending inventory at retail Estimated ending inventory at cost
324,500
$ $ 29,500
Correct!
Requirement 2: RALEIGH DEPARTMENT STORE LIFO Retail Method Cost 27,500 $ 282,000 26,500 (6,500) (5,000) Retail 45,000 490,000 (10,000) 25,000 (10,000) 495,000 540,000
Beginning inventory Plus: Purchases Freight-in Less: Purchase returns Purchase discounts Plus: Net markups Less: Net markdowns Goods available for sale (excl. beg. inv.) Goods available for sale (incl. beg. inv.) Cost-to-retail percentage Less: Net sales Employee discounts Less Net Sales Estimated ending inventory at retail Estimated ending inventory at cost: Beginning inventory Current period's layer Total $ $
$ 60%
297,000 324,500
$ $
Student Name: Instructor Class: McGraw-Hill/Irwin Problem 09-10 Requirement 3: RALEIGH DEPARTMENT STORE Dollar-Value LIFO Retail Method Ending Inventory at Base Year Retail Prices $ 55,000 Inventory Inventory Layers Layers at Base Year Converted To Retail Prices Cost $ 30,500 3,162 33,662
Correct!
2011 48,300
28,060 28,060
Correct!
Given Data P09-10: RALEIGH DEPARTMENT STORE 1/1/09 inventory retail value 1/1/09 inventory cost Transactions during 2009: Gross purchases Purchase returns Purchase discounts Gross sales Sales returns Employee discounts Freight-in Net markups Net markdowns 12/31/10 inventory retail value Cost-to-retail percentage under LIFO retail method Appropriate price index of the January 1, 2010 price level 12/31/11 inventory retail value Cost-to-retail percentage under LIFO retail method Appropriate price index of the January 1, 2010 price level $ Cost 282,000 6,500 5,000 $ Retail 490,000 10,000 492,000 5,000 3,000 26,500 25,000 10,000 $ 56,100 62% 102% 48,300 61% 105% $ $ 45,000 27,500