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AMPD 3033 Practice Test 4

The Retail Method of Inventory

1. Using the following figures from a menswear department, find the
closing book stock at retail.
Physical inventory January 15
Purchases retail January 16 through July 15
Gross sales
Returns from customers
Return to vendors

2. The


following figures are from a small boutique, which has a 55% MU

Opening book inventory at retail
Net Sales
Purchases (retail)
Determine the retail book inventory for the period
Convert the closing retail book inventory figure to the cost value.

3. The ladies accessory department has a closing book inventory, at

retail, of $600,000 and had achieved a 55.6% markup on total
merchandise handled. Determine the closing inventory at cost.

4. A sportswear department buyer was given the following data:


Opening inventory
Net Sales

a. The closing book inventory at retail
b. The closing book inventory at cost




5. Last year, the net sales in a mens denim department were $455,000.
The book inventory at year-end was $76,500, and the physical
inventory was $75,000. What was the shortage percentage?

6. If the retail book inventory at the close of the year is $1,250,000 and
the physical inventory totals only $1,075,000, what will be the
shortage percentage, if net sales were $12,000,000?

7. Find the shortage or overage percentage if:

Net sales
Opening inv (retail)
Employee Discounts
Retail purchases
Closing physical inventory

8. The merchandise plan for fall shows planned sales of $55,000 with an
estimated shortage of 1.5%. What are the planned dollar shortages
for fall?

9. The net sales of a maternity department were $325,000;inventory on

February 1 was $175,000;markdowns were 10% of net sales;
purchases for this period were $382,000;the physical inventory taken
on July 31 was $198,600
a. Was there a dollar shortage for this period
b. What was the shortage or overage percentage for this period?

A ladies outerwear department had an opening inventory of
$370,000. The net purchases were $86,000, gross sales were
$152,150, customer returns were $12,250, and markdowns-including
employee discounts-were $5200. Shortages of 1.5 % were estimated.
The closing retail book inventory
The estimated physical inventory