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Problem Solving Survival Guide to accompany Financial Accounting, 8th Edition by Donald E. Kieso, Paul D. Kimmel, Jerry J. Weygandt

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**EXERCISE 6-10

Purpose: (L.O. 8) This exercise illustrates the use of the retail inventory method to estimate ending inventory.

The records of Petite Clothiers report the following figures for the month of September:

Sales $79,000
Sales returns 1,000
Freight on purchases 2,400
Purchases (at cost) 48,000
Purchases (at sales price) 92,000
Purchase returns (at cost) 2,000
Purchase returns (at sales price) 3,000
Beginning inventory (at cost) 30,000
Beginning inventory (at sales price) 51,000

Instructions

Compute an estimate of the cost of ending inventory by using the retail inventory method.

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