The Ruffier Department Store uses the retail inventory method. The following information is available at December 31, 2014:

Cost

Retail

Beginning inventory

$37800

$60,000

Purchases

200000

290000

Freight-in

7200

Net sales

275000

What is the estimated cost of the ending inventory?

  1. $47,250.
  2. $52,500.
  3. $53,586.
  4. $192,500.