This information is available for Marias Corporation for 1997, 1998, and 1999.

Compute inventory turnover ratio, days in inventory, and current ratio based on LIFO and after adjusting for LIFO reserve.

(SO 8, 9) Marias uses the LIFO inventory method.

\section*{Instructions}
Calculate the inventory turnover ratio, days in inventory, and current ratio for Marias Corporation for 1997,1998 , and 1999 as follows:

(a) Based on LIFO

(b) After adjusting for the LIFO reserve

(c) Comment on any difference between parts

(a) and (b).

Transcribed Image Text:

1997 Beginning inventory Ending inventory Beginning LIFO reserve $ 200,000 1998 $ 300,000 1999 $ 400,000 300,000 400,000 500,000 150,000 170,000 200,000 Ending LIFO reserve 170,000 200,000 240,000 Current assets 500,000 600,000 700,000 Current liabilities 300,000 900,000 1,000,000 Cost of goods sold 900,000 1,120,000 1,250,000 Sales 1,200,000 1,600,000 1,900,000