Question
Larkspur Company cans a variety of vegetable-type soups. Recently, the company decided to value its inventories using dollar-value LIFO pools. The clerk who accounts for
Larkspur Company cans a variety of vegetable-type soups. Recently, the company decided to value its inventories using dollar-value LIFO pools. The clerk who accounts for inventories does not understand how to value the inventory pools using this new method, so, as a private consultant, you have been asked to teach him how this new method works. He has provided you with the following information about purchases made over a 6-year period. Date Ending Inventory (End-of-Year Prices) Price Index Dec. 31, 2013 $81,300 100 Dec. 31, 2014 114,704 107 Dec. 31, 2015 111,386 122 Dec. 31, 2016 134,463 133 Dec. 31, 2017 152,581 143 Dec. 31, 2018 180,708 148 You have already explained to him how this inventory method is maintained, but he would feel better about it if you were to leave him detailed instructions explaining how these calculations are done and why he needs to put all inventories at a base-year value. Compute the ending inventory for Richardson Company for 2013 through 2018 using dollar-value LIFO.
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