Question

What is the effect of freight-in on the cost-to-retail ratio when using the conventional retail method? Depends on the amount of the net markups. Decreases the cost-to-retail ratio. Increases the cost-to-retail ratio. No effect on the cost-to-retail ratio.

Answer 1

The answer is " Increases the cost-to-retail ratio

Step-by-step explanation:

An inventory method which is based on the relationship between the cost of the product and its retail price. This method is used by evaluate the cost of goods at-hand that have not been sold at the end of a particular reporting period.

Cost-to-retail ratio is the total cost of goods available for sale divided by the retail value of goods available for sale.