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The retail sales method relies on the relationship between the cost and the selling price to estimate the company?¦s ending inventory and cost of goods sold. Price fluctuations are adjusted by applying various price indexes such as the CPI (Consumer Price Index) to the total dollar value of each inventory category.
The company feels using this method combination provides the following advantages. (Davison, S. & Weil, R., 1983, pp. 16-23).
?X It is ideal because the company sells many different items at low unit prices.
?X Cost flow methods can be incorporated into the estimation technique
?X It is not necessary to physically count inventory to estimate ending inventory and cost of goods sold...
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Common topics in this essay:
- inventory management
- Competency Inventory
- Inventory Management
- Inventory Valuation
- inventory models
- Just in time inventory
- Organizational culture Inventory
- Retail Inventory
- Interest Inventory
- Inventory of the lost
- Retail Inventory
- Organization Culture Inventory
- Inventory Policy
- inventory control policy
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