Answer:the inventory by the conventional retail inventory method=the cost of Ending inventory becomes == $90,236.
Explanation:
Inventory computed for Ricky Henderson Company
Using the conventional retail inventory method, we have
Cost Retail
Beginning of Inventory $ 282,140 $ 291,600
Purchases 1,425,000 2,144,000
Total 1,707,140 2,435,600
Add:
Net Markups 74,900
(Markups -Markup 92,300 - 17,400)
cancellations)
Total 1,707,140 2510500
Less:
Net Markdown 31,800
(Markdowns -Markdown (37,900 - 6,100)
cancellations)
Sales price of goods 2,478,000
Sales revenue 2,346,000
The retail ending 132,700
(Sales price of goods-Sales revenue)
Therefore,
The retail cost ratio is = 1,707,140 /2,510,500=0.68= 68%
Hence, the cost of Ending inventory becomes = 132,700 x 68%
= $90,236.
