Question

On January 1, 2018, the Haskins Company adopted the dollar-value LIFO method for its one inventory pool. The pool’s value on this date was $840,000. The 2018 and 2019 ending inventory valued at year-end costs were $884,000 and $954,000, respectively. The appropriate cost indexes are 1.04 for 2018 and 1.06 for 2019.

Required:
Complete the below table to calculate the inventory value at the end of 2018 and 2019 using the dollar-value LIFO method. (Round "Year end cost index" to 2 decimal places. Round other final answer values to the nearest whole dollars.)

	Inventory Layers Converted to Base Year Cost Inventory Layers Converted to Cost Ending 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 01/01/2018 = Base = $0 12/31/2018 = Base = 2018 = $0 12/31/2019 = Base = 2018 = 2019 = $0

Answer 1

	Inventory layers converted to base year cost						Inventory Layers Converted to Cost					Ending 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
01/01/2018	840000	/	1	=	840000	Base	840000	*	1	=	840000	840000
12/31/2018	884000	/	1.04	=	850000	Base	840000	*	1	=	840000
						2018	10000	*	1.04	=	10400	850400
12/31/2019	954000	/	1.06	=	900000	Base	840000	*	1	=	840000
						2018	10000	*	1.04	=	10400
						2019	50000	*	1.06	=	53000	903400