Total Color, Inc. manufactures and distributes house paints. Total Color uses the dollar-value LIFO method. Information for
Question:
Total Color, Inc. manufactures and distributes house paints. Total Color uses the dollar-value LIFO method. Information for 2018, 2019, and 2020 is presented in the following table.
Year Inventory -FIFO
2018 - Base year ................. $356,000
2019 ..................................... $379,700
2020 ..................................... $414,000
The cumulative price indices for 2018, 2019, and 2020, respectively are 1.0000, 1.0230, and 1.0537.
Required
a. Compute the company's ending inventory using dollar-value LIFO for each year. Round to the nearest dollar.
b. Prepare the journal entry required to adjust the LIFO reserve for each year.
Ending InventoryThe 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 =...
Step by Step Answer:
a Computation of dollarvalue LIFO ending inventory Computation of ending inventory for each year at ...View the full answer
Intermediate Accounting
ISBN: 978-0134730370
2nd edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
