The dollar-value LIFO method was adopted by Crane Corp. on January 1, 2017. Its

Question

The dollar-value LIFO method was adopted by Crane Corp. on January 1, 2017. Its inventory on that date was $390,700. On December 31, 2017, the inventory at prices existing on that date amounted to $369,600. The price level at January 1, 2017, was 100, and the price level at December 31, 2017, was 112.

Exercise 8-21 The dollar-value LIFO method was adopted by Crane Corp. on January 1, 2017. Its inventory on that date was $390,700. On December 31, 2017, the inventory at prices existing on that date amounted to $369,600. The price level at January 1, 2017, was 100, and the price level at December 31, 2017, was 112 Compute the amount of the inventory at December 31, 2017, under the dollar-value LIFO method Inventory 12/31/17 under dollar-value LIFO method LINK TO TEXT On December 31, 2018, the inventory at prices existing on that date was $409,055, and the price level was 115. Compute the inventory on that date under the dollar- value LIFO method Inventory 12/31/18 under dollar-value LIFO method Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT

Explanation / Answer

Calculate inventory 12/31/17 under dollar value LIFO method :

Inventory cost at base year price = 369600/1.12 = 330000

Inventory 12/31/17 under dollar value LIFO method = 330000*1 = $330000

Calculate inventory 12/31/18 under dollar value LIFO method

Inventory cost at base year price = 409055/1.15 = 355700

Inventory 12/31/18 under dollar value LIFO method = 330000*1+25700*1.15 = $359555

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