Garden World Uses the Retail Method to Estimate Its Monthly

Multiple Choice

Garden World uses the retail method to estimate its monthly cost of goods sold and month-end inventory. At 31 May, the accounting records indicate the cost of goods available for sale during the month (beginning inventory plus purchases) totaled $540,000. These goods had been priced for resale at $900,000. Sales in May totaled $480,000. The estimated inventory at 31 May is:

A) $540,000.
B) $252,000.
C) $420,000.
D) $288,000.