A company uses the dollar-value LIFO method of computing inventory. An external price index is used to convert ending inventory to base year. The company began operations on January 1, 2024, with an inventory of $120,000. Year-end inventories at year-end costs and cost indexes for its one inventory pool were as follows: Year Ended December 31 2024 2025 2026 2027 Ending Inventory at Cost Index (Relative to Year-End Costs $ 198,000 Base Year) 1.10 261,800 1.19 243,600 1.16 240,800 1.12
A company uses the dollar-value LIFO method of computing inventory. An external price index is used to convert ending inventory to base year. The company began operations on January 1, 2024, with an inventory of $120,000. Year-end inventories at year-end costs and cost indexes for its one inventory pool were as follows: Year Ended December 31 2024 2025 2026 2027 Ending Inventory at Cost Index (Relative to Year-End Costs $ 198,000 Base Year) 1.10 261,800 1.19 243,600 1.16 240,800 1.12
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A company uses the dollar-value LIFO method of computing inventory. An external price index is used to convert ending inventory to
base year. The company began operations on January 1, 2024, with an inventory of $120,000. Year-end inventories at year-end costs
and cost indexes for its one inventory pool were as follows:
Year Ended
December 31
2024
2025
2026
2027
Ending Inventory at Cost Index (Relative to
Year-End Costs
$ 198,000
Base Year)
1.10
261,800
1.19
243,600
1.16
240,800
1.12
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