Exercise 825 Date Ending Inventory EndofYear Prices Price In

Exercise 8-25

Date

Ending Inventory
(End-of-Year Prices)

Price
Index

Exercise 8-25 Presented below is information related to Dino Radja Company. Date Ending Inventory (End-of-Year Prices) Price Index December 31, 2011 $ 64,200 100 December 31, 2012 156,792 139 December 31, 2013 153,912 159 December 31, 2014 178,020 172 December 31, 2015 211,825 185 December 31, 2016 249,216 192 Compute the ending inventory for Dino Radja Company for 2011 through 2016 using the dollar-value LIFO method. Ending Inventory 2011 $ 2012 $ 2013 $ 2014 $ 2015 $ 2016 $

Solution

Current $

Price Index

Base Year

Date

a

b

c=a/b%

Change from prior year

2011

                  64,200

100

      64,200

                                            -  

2012

               1,56,792

139

   1,12,800

                                   48,600

2013

               1,53,912

159

      96,800

                                (16,000)

2014

               1,78,020

172

   1,03,500

                                     6,700

2015

               2,11,825

185

   1,14,500

                                   11,000

2016

               2,49,216

192

   1,29,800

                                   15,300

Ending Inventory—Dollar-value LIFO:

Year

Ending Inventory

2011

                  64,200

Year

Current $

Price Index

Base Year

2012

                  64,200

100

      64,200

                  48,600

139

      67,554

Ending Inventory

   1,31,754

Year

Current $

Price Index

Base Year

2013

                  64,200

100

      64,200

                  32,600

139

      45,314

Ending Inventory

   1,09,514

Year

Current $

Price Index

Base Year

2014

                  64,200

100

      64,200

                  32,600

139

      45,314

                     6,700

172

      11,524

Ending Inventory

   1,21,038

Year

Current $

Price Index

Base Year

2015

                  64,200

100

      64,200

                  32,600

139

      45,314

                     6,700

172

      11,524

                  11,000

185

      20,350

Ending Inventory

   1,41,388

Year

Current $

Price Index

Base Year

2016

                  64,200

100

      64,200

                  32,600

139

      45,314

                     6,700

172

      11,524

                  11,000

185

      20,350

                  15,300

192

      29,376

Ending Inventory

   1,70,764

Year

Ending Inventory

2011

$         64,200

2012

$           131,754

2013

$           109,514

2014

$           121,038

2015

$           141,388

2016

$           170,764

	Current $	Price Index	Base Year
Date	a	b	c=a/b%	Change from prior year
2011	64,200	100	64,200	-
2012	1,56,792	139	1,12,800	48,600
2013	1,53,912	159	96,800	(16,000)
2014	1,78,020	172	1,03,500	6,700
2015	2,11,825	185	1,14,500	11,000
2016	2,49,216	192	1,29,800	15,300