Exhibit 7-5 Sullivan Produce Co. switched from FIFO to LIFO on January 1, 2013, for external reporting and income tax purposes, while retaining FIFO for internal reports. On that date, the FIFO inventory equaled $360,000. The ensuing three-year period resulted in the following:
-Refer to Exhibit 7-5. The ending inventory at December 31, 2014, using the dollar-value LIFO method would be
A) $400,000
B) $402,000
C) $406,000
D) $424,000

Question

Exhibit 7-5 Sullivan Produce Co. switched from FIFO to LIFO on January 1, 2013, for external reporting and income tax purposes, while retaining FIFO for internal reports. On that date, the FIFO inventory equaled $360,000. The ensuing three-year period resulted in the following:  
-Refer to Exhibit 7-5. The ending inventory at December 31, 2014, using the dollar-value LIFO method would be
A) $400,000 
B) $402,000 
C) $406,000 
D) $424,000

Quizplus · Accepted Answer

The Answer of Exhibit 7-5 Sullivan Produce Co. switched from FIFO to LIFO on January 1, 2013, for external reporting and income tax purposes, while retaining FIFO for internal reports. On that date, the FIFO inventory equaled $360,000. The ensuing three-year period resulted in the following:  
-Refer to Exhibit 7-5. The ending inventory at December 31, 2014, using the dollar-value LIFO method would be
A) $400,000 
B) $402,000 
C) $406,000 
D) $424,000