Asked by PETER MATOKE on May 23, 2024
Verified
The retail method is used by many manufacturing businesses to estimate the amount of sales.
Retail Method
An accounting procedure for estimating the value of a store's merchandise by using the cost to retail price ratio.
Manufacturing Businesses
Companies that produce new products from raw materials through various processes, machinery, and operations.
- Examine the application of the retail method for estimating closing inventory.
Verified Answer
LC
Lauren CantrellMay 26, 2024
Final Answer :
False
Explanation :
The retail method is primarily used by retail businesses to estimate inventory levels, not by manufacturing businesses for estimating sales. Manufacturing businesses may use different methods such as demand forecasting for estimating sales.
Learning Objectives
- Examine the application of the retail method for estimating closing inventory.