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Problem - San Lorenzo General Store uses a periodic inventory system and the retail inventory method to estimate ending inventory and cost of goods sold. The following data are available for the month of October 2011:
Cost Retail
Beginning inventory $ 38,500 $ 55,000
Net purchases 19,120 34,760
Net markups 1,320
Net markdowns 880
Net sales 35,200
Required: Estimate the average cost of ending inventory and cost of goods sold for October. Do not approximate LCM.
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