# The current fifo costs of ending inventory is equal

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the current (FIFO) costs of ending inventory is equal to \$2,300 and \$12,750 at the beginning and end of the year, respectively. Required » a. Determine the ending inventory and cost of goods sold for the current year. b. Use the footnote information provided in the question to convert the beginning and ending inventory from a LIFO to a FIFO basis. c. What journal entry is required on December 31 to convert to FIFO? d. Convert the cost of goods sold for the current year from the LIFO to the FIFO basis. e. Compare the inventory turnover ratio for the current year computed under the two methods of inventory valuation. ➌➑E10-6. LIFO. Burke Company uses the LIFO perpetual method for financial reporting and tax purposes. A summary of Burke’s inventory for the current year is presented below. LIFO Inventory Description Units Unit Cost Total Cost Units Sold Beginning inventory: January 1 First layer 10,000 \$3.10 \$ 31,000 Second layer 6,000 3.90 23,400 Total beginning inventory 16,000 \$ 54,400 Units sold on February 20 at \$7.05 14,000 Purchases or Production: March 31 2,000 5.10 10,200 July 15 8,500 5.60 47,600 Units sold on December 1 at \$7.25 11,000 Cost of goods available for sale 26,500 \$112,200 Totalunits sold (25,000) Ending inventory: December 31 1,500 Year Inventory - FIFO 2014 – Base Year \$356,000 2015 \$379,700 2016 \$414,000 Required » a. Compute the ending inventory and cost of goods sold for the current year. b. Prepare a partial income statement showing the gross profit for the current year. E10-7. Dollar Value LIFO, LIFO Reserve. Total Color, Inc. manufactures and distributes house paints. Total Color uses the dollar-value LIFO method.
Information for 2014, 2015, and 2016 is presented in the following table. The cumulative price indices for 2014, 2015, and 2016 respectively are 1.0000, 1.0230, and 1.0537. Required » a. Compute the company’s ending inventory using dollar-value LIFO for each year. b. Prepare the journal entry required to adjust the LIFO reserve for each year.