Question
In: Accounting
On January 1, 2016, Badger Inc. adopted the dollar-value LIFO method. The inventory cost on this...
|
On January 1, 2016, Badger Inc. adopted the dollar-value LIFO method. The inventory cost on this date was $114,000. The 2016 ending inventory, valued at year-end costs, was $165,000. The relative cost index for this inventory in 2016 was 1.20. |
|
Suppose that Badger's 2017 ending inventory, valued at year-end costs, was $176,400 and that the relative cost index for this inventory in 2017 was 1.26. In determining the inventory balance should Badger report in its 12/31/17 balance sheet: |
Solutions
Expert Solution
Solution:
| Computation of inventory at base year prices and change from prior year | ||||
| Year | Inventory at end of year prices | Price index | Inventory at base year prices | Change from Prior Years |
| 2015 | $114,000.00 | 1.00 | $114,000.00 | $0.00 |
| 2016 | $165,000.00 | 1.20 | $137,500.00 | $23,500.00 |
| 2017 | $176,400.00 | 1.26 | $140,000.00 | $2,500.00 |
| Computation of dollar value inventory - LIFO | |
| Particulars | Amount |
| December 31, 2017: | |
| $114,000*$1 | $114,000 |
| $23,500*$1.20 | $28,200 |
| $2,500*1.26 | $3,150 |
| Inventory at Dec 31, 2017 | $145,350 |
ekkarill92 answered 2 years agoRelated Solutions
1/ On January 1, 2018, Badger Inc. adopted the dollar-value LIFO method. The inventory cost on...
1/ On January 1, 2018, Badger Inc. adopted the dollar-value LIFO
method. The inventory cost on this date was $100,300. The ending
inventory, valued at year-end costs, and the relative cost index
for each of the next three years is below:
Year-end
Ending inventory at
year-end costs
Cost Index
2018
$
126,945
1.05
2019
144,320
1.10
2020
154,860
1.20
In determining the
inventory balance should Badger report in its 12/31/2019 balance
sheet:
Multiple Choice
An additional layer of
$23,330 is...
Kingbird Corporation adopted the dollar-value LIFO retail inventory method on January 1, 2016. At that time...
Kingbird Corporation adopted the dollar-value LIFO retail
inventory method on January 1, 2016. At that time the inventory had
a cost of $57,000 and a retail price of $100,000. The following
information is available. Year-End Inventory at Retail Current Year
Cost—Retail % Year End Price Index 2016 $133,560 56% 106 2017
146,520 59% 111 2018 124,120 60% 116 2019 168,750 57% 125 The price
index at January 1, 2016, is 100. Compute the ending inventory at
December 31 of the...
On January 1, 2016, HGC Camera Store adopted the dollar-value LIFO retail inventory method. Inventory transactions...
On January 1, 2016, HGC Camera Store adopted the dollar-value
LIFO retail inventory method. Inventory transactions at both cost
and retail, and cost indexes for 2016 and 2017 are as follows: 2016
2017 Cost Retail Cost Retail Beginning inventory $ 51,800 $ 74,000
Net purchases 101,150 125,000 $ 107,532 $ 131,700 Freight-in 3,700
4,200 Net markups 18,500 11,400 Net markdowns 3,700 3,900 Net sales
to customers 125,250 118,800 Sales to employees (net of 20%
discount) 3,000 6,720 Price Index: January...
On January 1, 2021, Avondale Lumber adopted the dollar-value LIFO inventory method. The inventory value for...
On January 1, 2021, Avondale Lumber adopted the dollar-value
LIFO inventory method. The inventory value for its one inventory
pool on this date was $275,000. An internally generated cost index
is used to convert ending inventory to base year. Year-end
inventories at year-end costs and cost indexes for its one
inventory pool were as follows:
Year Ended
Inventory
Cost Index
December 31
Year-End Costs
(Relative to Base Year)
2021
$
364,350
1.05
2022
374,960
1.09
2023
424,600
1.10
2024
454,260...
On January 1, 2021, Avondale Lumber adopted the dollar-value LIFO inventory method. The inventory value for...
On January 1, 2021, Avondale Lumber adopted the dollar-value
LIFO inventory method. The inventory value for its one inventory
pool on this date was $330,000. An internally generated cost index
is used to convert ending inventory to base year. Year-end
inventories at year-end costs and cost indexes for its one
inventory pool were as follows:
Year Ended
Inventory
Cost Index
December 31
Year-End Costs
(Relative to Base Year)
2021
$
418,080
1.04
2022
429,840
1.08
2023
482,870
1.09
2024
520,240...
On January 1, 2018, Avondale Lumber adopted the dollar-value LIFO inventory method. The inventory value for...
On January 1, 2018, Avondale Lumber adopted the dollar-value
LIFO inventory method. The inventory value for its one inventory
pool on this date was $350,000. An internally generated cost index
is used to convert ending inventory to base year. Year-end
inventories at year-end costs and cost indexes for its one
inventory pool were as follows:
Year
Ended
Inventory
Cost Index
December
31
Year-End Costs
(Relative to Base Year)
2018
$
438,780
1.03
2019
451,540
1.07
2020
508,680
1.08
2021
548,895...
On January 1, year 1, Silver Industries Inc. adopted the dollar-value LIFO method of determining inventory...
On January 1, year 1, Silver Industries Inc. adopted the
dollar-value LIFO method of determining inventory costs for
financial and income tax reporting. The following information
relates to this change:
Silver has continued to use the FIFO method, which approximates
current costs, for internal reporting purposes. Silver's FIFO
inventories at December 31, year 1, year 2, and year 3 were
$100,000, $137,500, and $195,000, respectively.
The FIFO inventory amounts are converted to dollar-value LIFO
amounts using a single inventory pool...
On January 1, 2017, Flounder Wholesalers Inc. adopted the dollar-value LIFO inventory method for income tax...
On January 1, 2017, Flounder Wholesalers Inc. adopted the
dollar-value LIFO inventory method for income tax and external
financial reporting purposes. However, Flounder continued to use
the FIFO inventory method for internal accounting and management
purposes. In applying the LIFO method, Flounder uses internal
conversion price indexes and the multiple pools approach under
which substantially identical inventory items are grouped into LIFO
inventory pools. The following data were available for inventory
pool no. 1, which comprises products A and B,...
On January 1, 2020, Wildhorse Wholesalers Inc. adopted the dollar-value LIFO inventory method for income tax...
On January 1, 2020, Wildhorse Wholesalers Inc. adopted the
dollar-value LIFO inventory method for income tax and external
financial reporting purposes. However, Wildhorse continued to use
the FIFO inventory method for internal accounting and management
purposes. In applying the LIFO method, Wildhorse uses internal
conversion price indexes and the multiple pools approach under
which substantially identical inventory items are grouped into LIFO
inventory pools. The following data were available for inventory
pool no. 1, which comprises products A and B,...
On January 1, 2020, Blue Wholesalers Inc. adopted the dollar-value LIFO inventory method for income tax...
On January 1, 2020, Blue Wholesalers Inc. adopted the
dollar-value LIFO inventory method for income tax and external
financial reporting purposes. However, Blue continued to use the
FIFO inventory method for internal accounting and management
purposes. In applying the LIFO method, Blue uses internal
conversion price indexes and the multiple pools approach under
which substantially identical inventory items are grouped into LIFO
inventory pools. The following data were available for inventory
pool no. 1, which comprises products A and B,...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Define the following key terms 1. Routing 2. Connectionless 3. Best-effort delivery 4. Maximum transmission unit...
- Two 20.0-g ice cubes at –15.0 °C are placed into 255 g of water at 25.0...
- What role should original intent have in how the Supreme Court interprets the Constitution and laws...
- We want to examine the efficacy of the current flu vaccine at preventing the flu. Once...
- One year ago, your company purchased a machine used in manufacturing for $115000. You have learned...
- 1) Represent -34 and +67 in the following ways: a) 8 bit sign and magnitude representation...
- Peggy, a 17-year-old female, was referred by her pediatrician to a child psychiatry clinic for evaluation...
ADVERTISEMENT