Response to the following problem:
The records of Saturn Co. provide the following information for the year ended December 31.
At Cost At Retail
January 1 beginning inventory . . . . . . . . . $ 81,670 $114,610
Cost of goods purchased . . . . . . . . . . . . 492,250 751,730
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . 786,120
Sales returns . . . . . . . . . . . . . . . . . . . 4,480
Required
1. Use the retail inventory method to estimate the company's year-end inventory.
2. A year-end physical inventory at retail prices yields a total inventory of $78,550. Prepare a calculation showing the company's loss from shrinkage at cost and at retail.