P9-6 (Retail Inventory Method) The records for the Clothing Department of Sharapova’s Discount Store are summarized below for the month of January.
|Inventory, January 1,||at retail:||$25,000||at cost:||$17,000|
|Purchases in January,||at retail:||137,000||at cost:||82,500|
|Purchases returns,||at retail:||3,000||at cost:||2,300|
|Transfers in from suburban branch,||at retail:||13,000||at cost:||9,200|
|Inventory losses due to normal breakage, etc, at retail:||at retail:||400|
Instructions(a) Compute the inventory for this department as of January 31, at Retail
(b) Compute the inventory using lower of average cost or market.