Crane Sales Company Uses the Retail Inventory Method to Value

question 107

Multiple Choice

Crane Sales Company uses the retail inventory method to value its merchandise inventory.The following information is available for the current year: If the ending inventory is to be valued at the lower-of-cost-or-net realizable value, what is the cost to retail ratio?

• A)$177,500 ÷ $250,000
• B)$177,500 ÷ $258,500
• C)$175,000 ÷ $260,000
• D)$177,500 ÷ $248,500

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Definitions:

End-User Markets

Markets consisting of individuals or organizations that are the final consumers of products and services, using them for their own use.

Wholesaler

A person or company that sells goods in large quantities at low prices to retailers, rather than selling them directly to consumers.

Intermediaries

Entities that facilitate transactions or interactions between two or more parties in a supply chain, often involved in the distribution, wholesaling, and retailing of goods.

Retailers

Businesses or individuals that sell goods directly to consumers, acting as the final link in the supply chain from manufacturers to consumers.