When applying the retail method,which of the following would not be a component of the cost-to-retail percentage?
A)Purchases
B)Beginning inventory
C)Sales
D)Freight-in

Question

Quizplus · Accepted Answer

The cost-to-retail percentage is calculated by dividing the cost of goods by the retail value of goods. Sales would not be included in this calculation as they represent the revenue generated from goods sold, not the cost of the goods themselves. Therefore, option C would not be a component in the cost-to-retail percentage when applying the retail method.

When Applying the Retail Method,which of the Following Would Not