On December 31, 2007, Ryanes Company had LIFO ending inventory consisting of 500 units with a LIFO

Question:

On December 31, 2007, Ryanes Company had LIFO consisting of 500 units with a LIFO cost of $10 per unit. During the first quarter of 2008, Ryanes sold 1,000 units. As of March 31, 2008, the inventory of Ryanes is 400 units, and the current purchase price of inventory is $32 per unit. The reduction in the level of inventory is temporary, and Ryanes fully expects inventory levels to be at or above 500 units by December 31, 2008.
The recorded cost of goods sold for Ryanes for the first quarter of 2008 is $29,800 [(900 × $32) × (100 × $10)]. What adjusting entry, if any, should Ryanes make on March 31, 2008, to correctly apply LIFO to the reporting of quarterly results?

Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...