Intermediate Accounting (2nd Edition)
2nd Edition
ISBN: 9780134730370
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Textbook Question
Chapter 10, Problem 10.6P
Dollar-Value LIFO, LIFO Liquidation. The following information was provided by Capri Company.
| Year | Ending Inventory at Average Cost | Cumulative Price Index |
| 2014 | $530,000 | 100 |
| 2015 | 620,000 | 105 |
| 2016 | 610,000 | 110 |
| 2017 | 485,000 | 111 |
| 2018 | 620,000 | 115 |
Capri adopted the dollar-value LIFO method using 2014 as the base year.
Required
- a. Compute Capri's ending inventory under the dollar-value LIFO method for the years 2014 through 2018.
- b. Prepare the
journal entries for 2015 through 2018 to adjust inventory to the dollar-value LIFO basis. - c. Determine the ending balance of the LIFO reserve for 2015 through 2018.
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What is the internal price index?
What is the dollar-value LIFO inventory?
The following information relates to the David Davis Company.
Price
Ending Inventory
(End-of-Year Prices)
Date
Index
December 31, 2016
$69,400
100
December 31, 2017
102,080
116
December 31, 2018
110,208
128
December 31, 2019
123,816
132
December 31, 2020
116,058
138
Use the dollar-value LIFO method to compute the ending inventory for Davis Company for 2016 through 2020.
Ending Inventory
2016
%24
2017
%24
2018
%24
2019
%24
2020
%24
The information below is provided for Sea Company:
Year
EndingInventory End-of-Year Prices
CostIndex
2017
$ 90,000
100
2018
97,650
105
2019
103,550
109
2020
$109,760
112
Required:Compute Sea Company's 2019 ending inventory using dollar-value LIFO.
Chapter 10 Solutions
Intermediate Accounting (2nd Edition)
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