1.

AA Hardware uses the LIFO method to value its inventory. Inventory at the beginning of the year consisted of 28,000 units of the companys one product. These units cost $14 each. During the year, 78,000 units were purchased at a cost of $17 each and 83,000 units were sold. Near the end of the fiscal year, management is considering the purchase of an additional 11,500 units at $17.

What would be the effect of this purchase on income before income taxes?

What would be the effect of this purchase on income before income taxes using FIFO method?

2.

3.

At the beginning of 2013, Quentin and Kopps (Q&K) adopted the dollar-value LIFO (DVL) inventory method On that date the value of its one inventory pool was $91,000. The company uses an internally generated cost index to convert ending inventory to base year. Inventory data for 2013 through 2016 are as follows Required Determine the missing amounts Ending Inventory at Year-End costs Ending Inventory at DVL cost Ending Year Ended December 31 2013 2014 2015 2016 Inventory at Base-Year Costs Cost Index 1.06 1.15 106,000 112,360 $ 150,650 165,770S 137,000 1.26 S 147,068