On the Basis of the Following Data, Estimate the Cost

Essay

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