On January 1, 2013, the Taylor Company adopted the dollar-value LIFO method. The

Question

On January 1, 2013, the Taylor Company adopted the dollar-value LIFO method. The inventory value for its one inventory pool on this date was $310,000. Inventory data for 2013 through 2015 are as follows:

Date

Ending Inventory at Year-End Costs

Cost Index

12/31/13

$339,900

1.03

12/31/14

$382,950

1.11

12/31/15

$398,650

1.19

Required:

Calculate Taylor’s ending inventory for 2013, 2014, and 2015.

Ending

Date

Inventory

12/31/13

12/31/14

12/31/15

Date

Ending Inventory at Year-End Costs

Cost Index

12/31/13

$339,900

1.03

12/31/14

$382,950

1.11

12/31/15

$398,650

1.19

Explanation / Answer

Inventory at base year cost Cost Index Inventory layer Inventory at added year cost Inventory (Dollar Value LIFO) 1-Jan-13       310,000 1.00 31-Dec-13       339,900 1.03 330,000            9,900          10,197 320,197 31-Dec-14       382,950 1.11 345,000          35,000          38,850 348,850 31-Dec-15       398,650 1.19 335,000          25,000          29,750 339,750

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