Problem:
When you undertook the preparation of the financial statements for Flower Del Ley Company at January 31, 2007, the following data were available:
At Cost At Retail
Inventory, February 1, 2006 $71,700 $ 99,500
Markdowns 34,000
Markups 62,000
Markdown cancellations 20,000
Markup cancellations 10,000
Purchases 220,500 298,100
Sales 363,000
Purchases returns and allowances 4,300 5,500
Sales returns and allowances 10,000
Instructions:
Compute the ending inventory at cost as of January 31, 2007, using the retail method which approximates lower of cost or market. Your solution should be in good form with amounts clearly labeled.