Raleigh Dept 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 exxamination 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:

a) The inventory at January 1, 2014, had a retail value of $45,000 and a cost of $27,500 bassed on the conventional retail method.

b) Transactions during 2014 were as follows:

Cost Retail

Gross purchases $282,000 $490,000

Purchase returns 6,500 10,000

Purchase discounts 5,000

Gross sales 492,000

Sales returns 5,000

Employee Discounts 3,000

Freight in 26,500

Net mark ups 25,000

Net mark downs 10,000

Sales to employees are recorded net of discounts.

c) The retail value of the December 31, 2015 inventory was $56,100, the cost to retail percentage for 2015 under the LIFO retail method was 62% and the appropriate price index was 102% of the January 1, 2015 price level.

d) The retail value of the December 31, 2016 inventory was $48,300, the cost to retail percentage for 2016 under the LIFO retail method was 61% and the appropriate price index was 105% 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. 2. Prepare a schedule showing the computation of the cost of inventory at December 31, 2014 bsed 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.