Use the retail inventory method to estimate the company”s year-end inventory.

The records of Saturn Co. provide the following information for the year ended December 31.

 

At Cost

At Retail

January 1 beginning inventory

$ 81,670

$114,610

Cost of goods purchased

492,250

751,730

Sales  

 

786,120

Sales returns

 

4,480

Required

1. Use the retail inventory method to estimate the company’s year-end inventory.

2. A year-end physical inventory at retail prices yields a total inventory of $78,550. Prepare a calculation  showing the company’s loss from shrinkage at cost and at retail.

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