Lacy's Linen Mart Uses the Average Cost Retail Method to Estimate

question 81

Multiple Choice

Lacy's Linen Mart uses the average cost retail method to estimate inventories.Data for the first six months of 2016 include: beginning inventory at cost and retail were $60,000 and $120,000,net purchases at cost and retail were $312,000 and $480,000,and sales during the first six months totaled $490,000.The estimated inventory at June 30,2016,would be:

• A)$ 68,200.
• B)$ 55,000.
• C)$ 71,500.
• D)$ 63,250.

---

Definitions:

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service versus the total amount they actually pay.

Producer Surplus

The difference between what producers are willing to accept for a product versus what they actually receive in the market.

Marginal Benefit

The increased benefit or value received from the consumption or creation of one more unit of a good or service.

Marginal Cost

The investment required to manufacture an additional unit of a product or service.