The Outsider Company, Inc, provided the following information regarding its inventory for the year ended December 31, 2019. It made all of the purchase, before it had any sales transactions for the year.

Required

a. Compute the LIFO reserve at the beginning of the year (i.e., at December 31, 2018).

b. Compute the LIFO reserve at the end of the year (i.e., at December 31, 2019).

c. Illustrate how the firm can use the LIFO reserve to convert ending inventory from the LIFO to the FIFO basis for both years (i.e., 2018 and 2019).

d. Illustrate how the firm can use the LIFO reserve to convert the LIFO cost of goods sold to the FIFO cost of goods sold for 2019.

e. Describe the conditions that indicate that there is a LIFO liquidation for 2019.

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FIFO Description LIFO Beginning inventory: January 1, 2019 8,000 @ $6 $ 48,000 $ 28,000 4,000 @ $7 12,000 @ $8 16,000 units 14.000 @ $9 30,000 units 6,000 @ $9 24,000 unts 96 000 8,000 @ $7 16,000 unıts 14 000 @ $9 56,000 Total beginning in ventory $ 104,000 $124,000 126 000 $250 000 126,000 Purchases Cost of goods availab e End ng inventory Cost of goods so d 30,000 units $ 230,000 6,000 @ $6 24,000 units 36 000 54,000 $196 000 $ 194,000