Exercise-4 (Ending inventory using dollar value LIFO method)

The Rehan company presents you the following data:

exercise-4-icm-img1

Required: Compute the value of inventory on December 31, 2015 and December 31, 2016 using dollar-value LIFO method.

Solution:

exercise-4-icm-img2

*Inventory at base year prices = Inventory at end of year prices / Price index

  • December 31, 2014: $39,500/1.00 = $39,500
  • December 31, 2015: $43,416/1.08 = $40,200
  • December 31, 2016: $51,870/1.14 = $45,500

Dollar-value LIFO inventory:

exercise-4-icm-img3

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3 Comments on Exercise-4 (Ending inventory using dollar value LIFO method)

  1. Keisha

    I was able to understand your problem solutions quicker than other sources. Thank you.

    Reply
  2. Edith Mwamba

    Thank you for the exercise, they help me to understand FIFO,LIFO methods. May you give us more exercises. Thank you once again!

    Reply
  3. Guren

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