1. What should DMT report as ending inventory on December 31st using the prepetual LIFO method? You may want to use a Perpetual Inventory Table to show your work.

2. Ignoring taxes, make the necessary journal entry to convert the current FIFO information to LIFO

3.DMT reported the following account balances using the FIFO inventory numbers:

Still ignoring income taxes, calculate the following ratios for DMT before and after converting inventory back to LIFO

Use the following to answer questions 1-3 The following table is the Cost of Goods Sold section of DMT, Inc.'s Income Statement: Beginning Inventory $60,000 Purchases $449,000 Pur Discount $8,000 Net Purchases $441,000 COGAS $501,000 $85,000 Ending Inventory $416,000 COGS Unfortunately, DMTs new accountant prepared this COGS section using FIFO. DMT has traditionally used the LIFO method for revaluing inventory. Now DMTs auditors are insisting that they switch the numbers to LIFO. You have been asked to help with the conversion. The following information contains all of the purchases and sales of inventory made DMT during the period: Purchases Purchase Unit Date Units Price Discount Beginning 10,000 $6.00 $0.00 5-Jan 20,000 $7.00 $0.25 15-Jan 30,000 $8.50 $0.00 25-Jan 6,000 $9.00 $0.50 Sales Date Units 2-Jan 8,000 8 Jan 18,000 26-Jan 30,000