On January 1, 2021, the Taylor Company adopted the dollar-value LIFO method. The inventory value for its one inventory pool on this date was $400,000. Inventory data for 2021 through 2023 are as follows: Date Ending Inventory at Year-End Costs Cost Index 12/31/2021 $ 441,000 1.05 12/31/2022 487,200 1.12 12/31/2023 510,000 1.20 Required: Calculate Taylor's ending inventory for 2021, 2022, and 2023.

2021 $421,000

2022 $437,800

2023 $426,600

Explanation:

INVENTORY LAYERS AY BASE YEAR COST

Inventory Layers at year

end cost÷Year end cost index =Inventory Layers at base year cost

1/ 1, 2021, $400,000÷1=$400,000

12/31/2021 $ 441,000 ÷1.05=$420,000

12/31/2022 487,200 ÷1.12=$435,000

12/31/2023 510,000÷1.20=$425,000

INVENTORY LAYERS CONVERTED TO COST

Inventory Layers

at base year cost× Year cost index=Inventory layers Converted to Cost

Base $400,000 ×1=$400,000

Base $400,000×1=$400,000

2021 $20,000×1.05=$21,000

Base $400,000×1=$400,000

2021 $20,000 1.05=$21,000

2022 $15,000×1.12÷$16,800

Base$400,000×1=$400,000

2021 $20,000×1.05=$21,000

2022$5,000×1.12=$5,600

INVENTORY DVL COST

Base $400,000×1=$400,000

2021 $20,000×1.05=$21,000

Total $421,000

Base $400,000×1=$400,000

2021 $20,000 1.05=$21,000

2022 $15,000×1.12÷$16,800

Total $437,800

Base$400,000×1=$400,000

2021 $20,000×1.05=$21,000

2022$5,000×1.12=$5,600

Total $426,600

you will have $2593.74 in 10 years if you set aside $1,000 at 10%

you will have $9321.91 in 20 years if you set aside $2000 at 8%

you will have $1469.32 in 5 years if you set aside $1000 at 8%

you will have $1296.87 in 10 years if you set aside $500 at 10%

you will have $239.66 in 15 years if you set aside $100 at 6%

you will have $4660.96 in 20 years if you set aside $1000 at 8%