Maple Corp.uses dollar-value LIFO.Certain information follows: $\begin{array}{rrr}
&\text { Ending Inventory- }\
\text { Year }&\text { Current Cost }&\text { Index }\
2010 & \$ 10,000 & 100 \
2011 & 11,845 & 103 \
2012 & 12,096 & 108 \
2013 & 13,090 & 110
\end{array}$ Compute the ending 2013 inventory.
A)$11, 900
B)$11, 985
C)$12, 006
D)$12, 090

Question

Quizplus · Accepted Answer

To compute the ending 2013 inventory using dollar-value LIFO, we first convert each year's ending inventory to base-year dollars, then apply the LIFO method. For 2013: $ \frac{13,090}{110} = 11,900 $ base-year dollars. The increase from 2012 is $ 11,900 - 11,200 = 700 $ base-year dollars. Convert this increase to 2013 dollars: $ 700 \times 1.10 = 770 $. Add this to the 2012 LIFO layer: $ 11,236 + 770 = 12,006 $.

Maple Corp Compute the Ending 2013 Inventory