Question

On January 1, 2021, the Taylor Company adopted the dollar-value LIFO method. The inventory value for its one inventory pool on this date was $400,000. Inventory data for 2021 through 2023 are as follows: UFO iny 2012 DE P 8-13 Dollar-value LIFO . 108-8 Ending Inventory at Year-End Costs Date suming the 12/31/2021 12/31/2022 12/31/2023 $441,000 487,200 510,000 Cost Index 1.05 1.12 1 .20 1 Required: Calculate Taylor's ending inventory for 2021, 2022, and 2023.

Answer 1

Solution:

AK УИ 7 Computation of inventory at base year prices and change from prior year Inventory at end of Price index Inventory at base year Change from Date year prices (Percentage) prices Prior Years 1-jan-2021 $400,000 1.00 $400,000 $O 31-Dec-21 $441,000 1.05 $420,000 $20,000 31-Dec-22 $487,200 $435,000 $15,000 31-Dec-23 $510,000 1.20 $425,000 $10,000 9 1.121 10 11 12 14 15 16 18 20 21 22 23 24 25 26 27 28 29 30 31 33 34 35 36 37 38 39 40 41 42 -26 (19) Sheet843 ) Sheet844 Sheet404 (6) Sheet248 (12)

M AK AR Computation of dollar value inventory - LIFO Particulars Amount December 31, 2021: $400,000*1 $400,000.00 $20,000*1.05 $21,000.00 11 12 13 14 15 Inventory at Dec 31, 2021 $421,000.00 16 17 December 31, 2022 $400,000*1 $20,000*1.05 $15000* 1.12 $400,000.00 $21,000.00 $16,800.00 19 20 Inventory at Dec 31, 2022 $437,800.00 21 22. 23 December 31, 2023: $400,000*1 $20,000*1.05 ($15000-$10000)* 1.12 24 25 26 $400,000.00 $21,000.00 $5,600.00 Inventory at Dec 31, 2023 $426,600.00 29 30 31 32 33 34 35 -26 (19) Sheet843 ) Sheet844 Sheet404 (6) Sheet248 (12)