Question

*Brief Exercise 8-9 Sheffield, Inc. uses the dollar-value LIFO method of computing its inventory. Data for the past 3 years follow. Year Ended Inventory at Current-Year Cost Price December 31 Index 2016 $18,100 100 2017 20,412 108 2018 24,069 113 Compute the value of the 2017 and 2018 inventories using the dollar-value LIFO method. 2018 2017 Inventory under LIFO $

Answer 1

Solution :

Ending Inventory Yr. (at base yr price) Layers 2016 $ 18,100 $ 18,100 18,100 2017 18,900 800 Ending inventory (Dollar Price Index | value LIFO) 100 $ 18,100 100 $ 18,100 108 864 $ 18,964 100 18,100 108 864 113 2,712 $ 21,676 2018 21,300 18,100 800 2,400

From above table 2017 inventory under LIFO = $18,964

and 2018 Inventory under LIFO = $21,676