Apply the Retail Method to the Following Company Information to Calculate

question 154

Essay

Apply the retail method to the following company information to calculate the cost of the ending inventory for the current period.
$$\begin{array} { | l | l | l | } \hline & \text { Cost } & \text { Retail } \\\hline \text { Beginning inventory } & \$ 20,224 & \$ 31,600 \\\hline \text { Net purchases } & 59,508 & 97,000 \\\hline \text { Sales } & & 89,000 \\\hline\end{array}$$

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Definitions:

Liquidity

The measure of how easily an asset or security can be converted into ready cash without affecting its market price.

Profitability

A measure of the ability of a company or business unit to generate earnings relative to its revenue, assets, equity, or other financial metrics over a certain period of time.

Price-earnings Ratio

A financial metric that measures a company's market share price relative to its earnings per share, indicating investor sentiment about future earnings.

Times

A financial metric used to compare two quantities or to indicate frequency. In business, it often refers to multiples or ratios used in financial analysis.