BE 911 Dollar-value LIFO retail

On January 1, 2018, Sanderson Variety Store adopted the dollar-value LIFO retail inventory method. Accounting records provided the following information:

	Cost	Retail
Beginning inventory	$ 40,800	$ 68,000
Net purchases	155,440	270,000
Net markups		6,000
Net markdowns		8,000
Net sales		250,000
Retail price index, end of year		1.02

BE 9-11) Calculate ending inventory under dollar value lifo retail method :

		Cost	Retail
Beginning inventory		40800	68000
Add: Net purchase		155440	270000
Add; Net Markups			6000
Less: Net Markdowns			(8000)
Goods available for sale (excluding beginning inventory)		155440	268000
Goods available for sale(including beginning inventory)		196240	336000
Base year cost to retail purchase 40800/68000	0.60
Cost to retail purchase 155440/268000	0.58
Less : net sales			(250000)
Estimated ending inventory at current year retail price			86000

ending inventory at year end retail price	step 1 ending inventory at base year retail prices	step 2 inventory layer at base year retail prices	step 3 inventory layers converted to costs
86000	86000/1.02=84314	68000	68000*1*.60=40800
		=84314-68000=16314	=16314*1.02*0.58=9651
Total ending invneotry at dollar value LIFO retail cost			50451

BE 912 Dollar-value LIFO retail

This exercise is a continuation of BE 911. During 2019, purchases at cost and retail were $168,000 and $301,000, respectively. Net markups, net markdowns, and net sales for the year were $3,000, $4,000, and $280,000, respectively. The retail price index at the end of 2019 was 1.06. Estimating ending inventory in 2019 using the dollar-value LIFO retail method.

BE 9- 11 ) Calculation done is right .

BE 9 - 12) Since 9-12 is contiuation of 9-11 therefore begining inventory cost and retail will remain the same as giving in 9-11.

		cost	retail
Beginning inventory		40800	68000
Add: Net purchase		168000	301000
Add; Net Markups			3000
Less: Net Markdowns			(4000)
Goods available for sale (excluding beginning inventory)		168000	300000
Goods available for sale(including beginning inventory)		208800	368000
Base year cost to retail purchase 40800/68000	0.60
Cost to retail purchase 168000/300000	0.56
Less : net sales			(280000)
Estimated ending inventory at current year retail price Estimated ending inventory at cost Estimated cost of goods sold (208800-49715)		+/- 1 (49715) 159085	88000

ending inventory at year end retail price	step 1 ending inventory at base year retail prices	step 2 inventory layer at base year retail prices	step 3 inventory layers converted to costs
88000	88000 / 1.06 = 83,019	68000	68000*1.00*0.60 =40800
		83019 - 68000 =15019	15019*1.06*0.56=8915
Total ending invneotry at dollar value LIFO retail cost			49715

BE 913 ? Change in inventory costing methods

In 2018, Hopyard Lumber changed its inventory method from LIFO to FIFO. Inventory at the end of 2017 of $127,000 would have been $145,000 if FIFO had been used. Inventory at the end of 2018 is $162,000 using the new FIFO method but would have been $151,000 if the company had continued to use LIFO. Describe the steps Hopyard should take to report this change. What is the effect of the change on 2018 cost of goods sold?

BE 914? Change in inventory costing methods

In 2018, Wade Window and Glass changed its inventory method from FIFO to LIFO. Inventory at the end of 2017 is $150,000. Describe the steps Wade Window and Glass should take to report this change.