Business, 06.05.2020 02:09 mia3128

Aber Company manufactures one product. On December 31, 2016, Aber adopted the dollar-value LIFO inventory method. The inventory on that date using the dollar-value LIFO inventory method was $900,000. Inventory data are as follows:

Year Inventory at year-end prices Price index (base year 2016)
2017 $1,260,000 1.05
2018 1,840,000 1.15
2019 1,900,000 1.25

Required:
Compute the inventory at December 31, 2017, 2018, and 2019, using the dollar-value LIFO method for each year.

Answers: 3

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Answers

Answer from: ndef5055

Inventory 2017 dollar-value LIFO $ 1215,000

Inventory 2017 dollar-value LIFO $ 1675,000

Inventory 2017 dollar-value LIFO $ 1583,000

Explanation:

Aber Company

Year Inventory at Price index Ending Inventory

year-end prices (base year 2016) At base year

2017 $1,260,000 1.05 $1200,000

2018 1,840,000 1.15 $ 1600,000

2019 1,900,000 1.25 $1520,000

Calculations

2017 Ending Inventory at base year price = $1,260,000 / 1.05 =$1200,000

2018 Ending Inventory at base year price = 1,840,000/ 1.15 =$ 1600,000

2019 Ending Inventory at base year price = 1,900,000 /1.25= $ 1520,000

We multiply each layer added with the price indices given to get the LIFO value dollar of inventory

Ending Inventory Layers Inventory

At base year Added LIFO dollar-value

$1200,000 300,000 900,000 at base year price

315,000

1215,000

$ 1600,000 700,000 900,000 at base price

300,000 at 1.05 315,000

400,000 at 1.15 460,000

1675,000

$1520,000 620,000 900,000 at base price

300,000 at 1.05 315,000

3200,000 at 1.15 368,000

1583,000

Computation of Inventory at 2017

Layer= $1200,000- $900,000= 300,000

Inventory at base = $900,000

$300,000 at 1.05= $315,000

Inventory at 2017 = 1215,000

Computation of Inventory at 2018

Layer= $1600,000- $900,000= 700,000

Inventory at base = $900,000

$300,000 at 1.05= $315,000

$400,000 at 1.15= $ 460,000

Inventory at 2018 = 1675,000

Computation of Inventory at 2017

Layer= $1520,000- $900,000= 620,000

Inventory at base = $900,000

$300,000 at 1.05= $315,000

$ 320,000 at 1.15= $ 368,000

Inventory at 2017 = 1583,000

Answer from: Quest

answer; /// i believe the correct answer is (all of the above);

Answer from: Quest

d. automatic stabilizers.

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Aber Company manufactures one product. On December 31, 2016, Aber adopted the dollar-value LIFO inve...

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