The Beta Company Uses the Retail Inventory Method for Valuation

question 80

Multiple Choice

The Beta Company uses the retail inventory method for valuation of its inventory.If an item had a cost of $45, was originally marked to sell at $60, was later priced at $55, and finally was priced at $63, the final price change is a

• A)net markup of $18
• B)markdown of $5 and a markup of $8
• C)net markdown of zero and an additional markup of $3
• D)net markdown of $5 and a net markup of $18

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Definitions:

Dividend Yield

A financial ratio that shows how much a company pays out in dividends each year relative to its share price, used by investors to evaluate the return on a dividend-paying stock.

Common Stock Quote

The current price at which a share of common stock is trading on the stock market.

Dividends

Profits paid out by a corporation to its shareholders as distributions.

Payments In Kind

Transactions where the payment is made in goods, services, or other non-cash forms instead of monetary payment.