This exercise reviews the relationships and computations involved with methods of estimating inventory.

Information relating to five different situations is as follows:

1.

Net sales

$132,000

 

 

Gross profit

52,800

Gross profit rate

 

 

 

2.

Net sales

$80,000

Cost of goods sold

52,000

Net income

12,000

Gross profit rate

 

 

 

3.

Cost of goods available for sale

$74,000

Estimated cost of goods sold

60.000

Estimated ending inventory at cost

 

 

 

4.

Beginning inventory at cost

$20,000

Purchases at cost

112,000

Purchases returns at cost

4,000

Net sales

200,000

Gross profit rate

45%

Estimated cost of goods sold

 

Estimated ending inventory at cost

 

5.

Cost of goods available for sale

$52,000

selling prices of goods for sale

18,000

Cost to retail ratio

 

6.

Beginning inventory at cost

$12,000

beginning inventory at retail

2U,UUU

Purchases at cost

62,100

Purchases at retail

94,000

Ending inventory at retail

17,200

Operating expenses

38,000

Cost to retail ratio

 

Estimated ending inventory at cost

 

Instructions

Fill in the missing figure(s) for each of the independent situations above.