The bookshop and stationer Hespéride measures the inventory of its school supplies department, made up of many fast-moving items with comparable margins, using the retail method. The year-end physical count, taken at selling prices, totals 180,000. Management has determined for this department a gross margin rate of 40 % of the selling price, markdowns included. Assuming that this technique gives a reliable approximation of cost, what is the cost of the school supplies inventory?
- Inventory counted at selling prices
- 180,000
- Gross margin rate on selling price
- 40 %