Exercise 9-27 Presented below is information related to Sandhill Corporation. Price Index LIFO Cost Retail Inventory...

Exercise 9-27

Presented below is information related to Sandhill Corporation. Price Index LIFO Cost Retail Inventory on December 31, 2017, when dollar-value LIFO is adopted 100 $36,600 $69,100 Inventory, December 31, 2018 110 ? 95,260 Compute the ending inventory under the dollar-value LIFO method at December 31, 2018. The cost-to-retail ratio for 2018 was 60%. Ending inventory under the dollar-value LIFO method at December 31, 2018

Expert Solution

Computation of ending Inventory under LIFO Method at December 31, 2018:

First Layer	=	$ 36,600
Second Layer	=	$ 11,550
Ending Inventory at December 31, 2018	=	$ 48,150

At retail:
Ending Inventory ($95260/1.10)	=	$ 86,600
Less: Beginning Inventory	=	$ 69,100
Incremental Difference	=	$ 17,500

Under LIFO:
Second Layer	=	$17500 X 1.10 X 60%
	=	$ 11,550

ekkarill92 answered 11 months ago

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