Question

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Mercury Company has only one Inventory pool. On December 31, 2021, Mercury adopted the dollar-value LIFO Inventory method. The Inventory on that date using the dollar-value LIFO method was $204,000. Inventory data are as follows: Year 2022 2023 2024 Ending Inventory at Year-End Costs $ 239,400 312,800 314,400 Ending Inventory at Base Year Costs $228,00 272,00 262,200 Required: Compute the Inventory at December 31, 2022, 2023, and 2024, using the dollar-value LIFO method. (Round "Year end cost Index" to 2 decimal places.) Inventory Layers Converted to Base Year Cost Inventory Layers Converted to Cost Inventory DVL Cost Date Inventory at Year-End Cost Year-End Cost Index Inventory Layers at Base Year Cost Inventory Lavers at Base Year Cost Year-End Cost Index Inventory Layers Converted to Cost Base 12/31/2021 12/31/2022 12/31/2023 Base 2022 Base 2022 2023 Base 12/31/2024 2022 2023 2024

Answer 1

Inventory layers converted to base year cost						Inventory layers converted to Cost					Inventory DVL cost
Date	inventory at year end cost	/	Year end cost index	=	Inventory layers at base year cost		Inventory layers at base year cost	*	Year end cost index	=	Inventory layers converted to Cost
12/31/2021	204000	/	1	=	204000	Base	204000	*	1	=	204000
12/31/2022	239400	/	1.05	=	228000	Base	204000	*	1	=	204000
						2022	24000	*	1.05	=	25200	229200
12/31/2023	312800	/	1.15	=	272000	Base	204000	*	1	=	204000
						2022	24000	*	1.05	=	25200
						2023	44000	*	1.15	=	50600	279800
12/31/2024	314400	/	1.20	=	262000	Base	204000	*	1	=	204000
						2022	24000	*	1.05	=	25200
						2023	34000	*	1.15	=	39100	268300