Question
Victor Manufacturing Co. switched from FIFO to LIFO on January 1, 2004 for external reporting and income tax purposes, while retaining FIFO for internal reports.
Victor Manufacturing Co. switched from FIFO to LIFO on January 1, 2004 for external reporting and income tax purposes, while retaining FIFO for internal reports. On that date the FIFO inventory equaled $360,000. The ensuing three-year period resulted in the following:
|
Date | Inventory Year-End Costs | Cost Index |
| December 31, 2004 | $438,000 | 1.05 |
| December 31, 2005 | 460,000 | 1.25 |
| December 31, 2006 | 520,000 | 1.35 |
The ending inventory at December 31, 2005, using the Dollar-value LIFO method would be
| a. | $370,000 |
| b. | $402,000 |
| c. | $368,400 |
| d. | $368,000 |
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Auditing Theory And Practice
Authors: Jerry R. Strawser, Robert H. Strawser
9th Edition
0873939336, 978-0873939331
