To produce an inventory valuation which approximates the lower of cost and net realizable value using the retail inventory method, the computation of the ratio of cost to retail should

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To produce an inventory valuation which approximates the lower of cost and net realizable value using the retail inventory method, the computation of the ratio of cost to retail should

A. Include markups but not markdowns

B. Include markups and markdowns

C. Ignore bothe markups and markdowns.

D. Include markdowns but not markups

Answer: A. Include markups but not markdowns

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