Brief Exercise 88 Wildhorse Company had ending inventory at

Brief Exercise 8-8

Wildhorse Company had ending inventory at end-of-year cost of $101,700 at December 31, 2016; $121,000 at December 31, 2017; and $135,140 at December 31, 2018. The year-end price indexes were 100 at 12/31/16, 110 at 12/31/17, and 116 at 12/31/18.

Compute the ending inventory for Wildhorse Company for 2016 through 2018 using the dollar-value LIFO method.

Solution

Compute the ending inventory for Wildhorse Company for 2016 through 2018 using the dollar-value LIFO method.

2017 Ending inventory = (101700*1+8300*1.1) = 110830

2018 Ending inventory = (101700*1+8300*1.1+6500*1.16) = 118370