On January 1, 2013, Avondale Lumber adopted the dollar-value LIFO inventory meth

Question

On January 1, 2013, Avondale Lumber adopted the dollar-value LIFO inventory method. The inventory value for its one inventory pool on this date was $350,000. An internally generated cost index is used to convert ending inventory to base year. Year-end inventories at year-end costs and cost indexes for its one inventory pool were as follows: Year Ended Inventory Cost Index December 31 Year-End Costs (Relative to Base Year) 2013 $ 438,780 1.03 2014 451,540 1.07 2015 508,680 1.08 2016 548,895 1.11 Required: Calculate inventory amounts at the end of each year.

Explanation / Answer

Solution:

(A). 2013

Ending Inventory:

Begining Inventory = 3,50,000

Less: Year end nventory - 4,38,780

= 88,780

(B). 2014

   Begining Inventory = 3,50,000

Less:Year end Inventory - 4,51,540

= 1,91,540

(C). 2015

Begining Inventory = 3,50,000

Less: Year end Inventory - 5,48,895

= 1,98,895

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.