Suppose Holt Renfrew the specialty retailer had these

records for #6647

Suppose Holt Renfrew the specialty retailer had these records for

Suppose Holt Renfrew, the specialty retailer, had these records for ladies' evening gowns
during 2017.

Beginning inventory (30 @ $1,000)....................................................................... $ 30,000

Purchase in February (25 @ $1,100)......................................................................... 27,500

Purchase in June (60 @ $1,200)................................................................................ 72,000

Purchase in December (25 @ $1,300)....................................................................... 32,500

Goods available..................................................................................................... $162,000

Assume sales of evening gowns totaled 130 units during 2017 and that Holt uses the weighted-
average-cost method under the periodic inventory system to account for inventory. The income
tax rate is 30%.

Requirements

1. Compute Holt's cost of goods sold for evening gowns in 2017.

2. Compute what cost of goods sold would have been if Holt had purchased enough inventory in
December-at $1,300 per evening gown-to keep year-end inventory at the same level it was at
the beginning of the year, 30 units?

Suppose Holt Renfrew the specialty retailer had these records for

ANSWER
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