Zanesville Pots Co

Essay

Zanesville Pots Co. uses the conventional retail method to estimate ending inventories. The following data has been summarized for the year ended December 31, 2009:
Required:
Estimate the cost of ending inventory applying the conventional retail method.
$$\begin{array} { l c r } & \text { Cost } & { \text { Retail } } \\\text { Inventory, January 1 } & \$ 88,000 & \$ 132,000 \\\text { Purchases } & 163,000 & 240,000 \\\text { Net markups } & & 10,100 \\\text { Net markdowns } & & 9,200 \\\text { Normal spoilage } & & 43,200 \\\text { Net sales } & & 213,000\end{array}$$