Raleigh Department Store uses the conventional retail method for the year ended December 31, 2019. Available information follows: a. The inventory at January 1, 2019, had a retail value of $49,000 and a cost of $34,380 based on the conventional retail method. b. Transactions during 2019 were as follows: Gross purchases Purchase returns Purchase discounts Gross sales Sales returns Employee discounts Freight-in Net markups Net markdowns Cost $323,040 6,300 5,400 28,500 Retail $530,000 14,000 509,500 10,000 5,000 otal ending inventory at dollar-value LIFO retail cost, 2020 otal ending inventory at dollar-value LIFO retail cost, 2021 29,000 14,000 Sales to employees are recorded net of discounts. c. The retail value of the December 31, 2020, inventory was $85,330, the cost-to-retail percentage for 2020 under the LIFO retail method was 69%, and the appropriate price index was 106% of the January 1, 2020, price level. d. The retail value of the December 31, 2021, inventory was $52,320, the cost-to-retail percentage for 2021 under the LIFO retail method was 68%, and the appropriate price index was 109% of the January 1, 2020, price level. equired: Assume Raleigh Department Store adopts the dollar-value LIFO retail method on January 1, 2020. Estimating ending inventory for D20 and 2021.

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Chapter1: Financial Statements And Business Decisions
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Raleigh Department Store uses the conventional retail method for the year ended December 31, 2019. Available
information follows:
a. The inventory at January 1, 2019, had a retail value of $49,000 and a cost of $34,380 based on the conventional retail
method.
b. Transactions during 2019 were as follows:
Gross purchases
Purchase returns
Purchase discounts
Gross sales
Sales returns
Employee discounts
Freight-in
Net markups
Net markdowns.
Cost
$323,040
6,300
5,400
28,500
Retail
$530,000
14,000
509,500
10,000
5,000
Total ending inventory at dollar-value LIFO retail cost, 2020
Total ending inventory at dollar-value LIFO retail cost, 2021
29,000
14,000
Sales to employees are recorded net of discounts.
c. The retail value of the December 31, 2020, inventory was $85,330, the cost-to-retail percentage for 2020 under the
LIFO retail method was 69%, and the appropriate price index was 106% of the January 1, 2020, price level.
d. The retail value of the December 31, 2021, inventory was $52,320, the cost-to-retail percentage for 2021 under the
LIFO retail method was 68%, and the appropriate price index was 109% of the January 1, 2020, price level.
Required:
3. Assume Raleigh Department Store adopts the dollar-value LIFO retail method on January 1, 2020. Estimating ending inventory for
2020 and 2021.
Transcribed Image Text:Raleigh Department Store uses the conventional retail method for the year ended December 31, 2019. Available information follows: a. The inventory at January 1, 2019, had a retail value of $49,000 and a cost of $34,380 based on the conventional retail method. b. Transactions during 2019 were as follows: Gross purchases Purchase returns Purchase discounts Gross sales Sales returns Employee discounts Freight-in Net markups Net markdowns. Cost $323,040 6,300 5,400 28,500 Retail $530,000 14,000 509,500 10,000 5,000 Total ending inventory at dollar-value LIFO retail cost, 2020 Total ending inventory at dollar-value LIFO retail cost, 2021 29,000 14,000 Sales to employees are recorded net of discounts. c. The retail value of the December 31, 2020, inventory was $85,330, the cost-to-retail percentage for 2020 under the LIFO retail method was 69%, and the appropriate price index was 106% of the January 1, 2020, price level. d. The retail value of the December 31, 2021, inventory was $52,320, the cost-to-retail percentage for 2021 under the LIFO retail method was 68%, and the appropriate price index was 109% of the January 1, 2020, price level. Required: 3. Assume Raleigh Department Store adopts the dollar-value LIFO retail method on January 1, 2020. Estimating ending inventory for 2020 and 2021.
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