DK Super Stores Inc

Essay

DK Super Stores Inc. uses the average cost retail method to estimate its ending inventory. Information at June 30, 2009, is as follows:
Required:
Compute the cost-to-retail percentage used by DK.
$$\begin{array} { l c c } & \text { Cost } & \text { Retail } \\\text { Beginning inventory } & & \$ 105,000 \\\text { Net purchases } & & 375,000 \\\text { Net sales } & & 380,000 \\\text { Ending inventory } & \$ 64,000\end{array}$$