A Company Has Been Using the Retail Inventory Method,average Basis,for

question 62

Essay

A company has been using the retail inventory method,average basis,for inventory measurement.Starting in 2013,the company changed to the FIFO retail method.
At the end of 2013,the company prepared the following retail method,"pure" FIFO basis,computation which you are to complete: $\begin{array}{|l|l|} \hline&\text { Cost } & \text { Retail } \\ \hline \text {Inventory (base) at January \( 1,2002 \).}&\$ 4,840 & \$ 8,400 \\\hline \text {Purchases.}&25,803 & 41,600 \\ \hline \text {Net additional mark-ups.}&700 & \\ \hline \text {Cost ratio.}&\$ 25,803 /& \$ 42,300=.61 \\ \hline \text {Total.}&30,643 & 50,700 \\ \hline \text {Sales.}&\$ 40,400 & \\ \hline \text {Inventory at December 31, 2002 (FIFO).}&\$ & \$\\ \hline\end{array}$

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Definitions:

Homeostasis

The tendency of the body to maintain a steady state.

Facial Feedback

The theory that sensory feedback from our facial expressions can affect our mood and emotions, suggesting that smiling can make us feel happier.

Socially Acceptable

Behaviors or practices that are considered acceptable or appropriate by a society or social group.

Cognitive-Mediational Theories

Cognitive-mediational theories suggest that cognitive processes—like thoughts and interpretations of events—mediate between the stimulus and the emotional or behavioral response.