On the Basis of the Following Data, What Is the Estimated

question 15

Multiple Choice

On the basis of the following data, what is the estimated cost of the merchandise inventory on May 31 using the retail method?? $\begin{array}{llrr}&&\text { Cost } & \text { Retail } \\\text { May 1 } & \text { Merchandise inventory } & \$ 125,000 & \$ 166,667 \\\text { May 1-31 } & \text { Purchases } & 235,000 & 313,333 \\\text { May 1-31 } & \text { Sales } & & 230,000\end{array}$

• A) $250,000
• B) $360,000
• C) $172,500
• D) $187,500

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Definitions:

Uncollectible Accounts Receivable

Money owed to a business by its customers that is unlikely to be paid and often written off as a loss.