Raleigh Department Store converted from the conventional retail method to the LIFO retail method on January 1, 2014, and is now considering converting to the dollar-value LIFO retail inventory method. Management requested, during your examination of the financial statements for the year ended December 31, 2016, that you furnish a summary showing certain computations of inventory costs for the past three years. Available information follows:

a.The inventory at January 1, 2014, had a retail value of $41,000 and a cost of $32,170 based on the conventional retail method.

b.Transactions during 2014 were as follows:

Cost Retail

Gross purchases $224,310 $450,000

Purchase returns 6,100 24,000

Purchase discounts 4,600

Gross sales 408,500

Sales returns 5,000

Employee discounts 5,500

Freight-in 27,500

Net markups 21,000

Net markdowns 24,000

Sales to employees are recorded net of discounts.

c.The retail value of the December 31, 2015, inventory was $59,800, the cost-to-retail percentage for 2015 under the LIFO retail method was 74%, and the appropriate price index was 104% of the January 1, 2015, price level.

d.The retail value of the December 31, 2016, inventory was $47,080, the cost-to-retail percentage for 2016 under the LIFO retail method was 73%, and the appropriate price index was 107% of the January 1, 2015, price level.

Required:1.Prepare a schedule showing the computation of the cost of inventory at December 31, 2014, based on the conventional retail method. (Amounts to be deducted should be indicated by a minus sign.)

2.Prepare a schedule showing the computation of the cost of inventory at December 31, 2014, based on the LIFO retail method.

3.Calculate the cost of inventory for December 31, 2015 and 2016, based on the dollar-value LIFO retail method.