$23$ pts

Question $2$

$23$ points: ESTIMATED TIME $15$ minutes

Dollar$-$value LIFO method.

Part A$.$ Moreli Company has a beginning inventory in year one of $$1,200,000$ and an ending inventory of $$1,485,000.$ The price level has increased from $100$ at the beginning of the year to $110$ at the end of year one. Calculate the ending inventory under the dollar$-$value LIFO method. YOU MUST SHOW YOUR CALCULATIONS TO RECEIVE CREDIT!!

Part B$.$ At the end of year two, Moreli's inventory is $$1,667,500$ in terms of a price level of $115$ which exists at the end of year two. Calculate the inventory at the end of year two continuing the use of the dollar$-$value LIFO method. YOU MUST SHOW YOUR CALCULATIONS TO RECEIVE CREDIT!!