On the Basis of the Following Data, Estimate the Cost

question 172

Essay

On the basis of the following data, estimate the cost of the merchandise inventory at March 31 by the retail method. $$\begin{array} { l l r r } \text { March 1 } & \text { Merchandise inventory } & \$ 250,000 & \$ 350,000 \\\text { March 1-31 } & \text { Purchases (net) } & 850,000 & 1,650,000 \\\text { March 1-31 } & \text { Sales } & & 845,000\end{array}$$

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Definitions:

Holder In Due Course

A person who has acquired a negotiable instrument in good faith and for value, and thus has certain rights above the original parties to the instrument.

Restrictive Indorsement

A limitation placed on the transfer of a negotiable instrument, such as a check, which specifies the conditions under which it can be further negotiated.

Merchants Bancorp

An American banking company involved in providing banking and financial services.

Holder In Due Course

A person who acquires a negotiable instrument in good faith and for value, thus having certain protections against defenses and claims.