Alquist Company uses the retail method to estimate its ending inventory. Selected information about its...
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Alquist Company uses the retail method to estimate its ending inventory. Selected information about its year 2024 operations is as follows: January 1, 2024, beginning inventory had a cost of $254,000 and a retail value of $240,000. Purchases during 2024 cost $1,547,000 with an original retail value of $2,810,000. Freight costs were $19,000 for incoming merchandise. Net additional markups were $200,000 and net markdowns were $400,000. Based on prior experience, shrinkage due to shoplifting was estimated to be $24,000 of retail value. Merchandise is sold to employees at a 25% of selling price discount. Employee sales are recorded in a separate account at the net selling price. The balance in this account at the end of 2024 is $360,000. Sales to customers totaled $2,020,000 for the year. Required: 1. Estimate ending inventory and cost of goods sold using the conventional retail method.
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