On January 1, 2020, Mirada, Inc. issued five year bonds with a face value of $100,000 and an annual stated rate of 8%. Interest
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Answer:
Closing inventory is $294,932
Explanation:
The retail inventory method is used by retailers in estimating their closing inventory.
It identifies the relationship between cost and retail prices and thus associates cost to its net sales using the cost to retail ratio to work our its costs of sales which further guides in defining what his profit ought to be.
The cost to retail ratio is cost price divided by retail selling price
The cost of sales worked out is then deducted from Cost of Goods available for sales to determine the closing inventory/stock.
The schedule attached shows the relationship between cost and retail and how we arrived at a closing inventory of $294,932
