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8_murik_8 [283]
3 years ago
6

RF Company had January 1 inventory of $300,000 when it adopted dollar-value LIFO. During the year, purchases were $1,800,000 and

sales were $3,000,000. December 31 inventory at year-end prices was $430,080, and the price index was 1.12. What is RF Company’s ending inventory?
Business
2 answers:
Sliva [168]3 years ago
4 0

Answer:

$394,080

Explanation:

Given

January inventory =

$300,000

December inventory = $ 430,080

Price index = 1.12

We use the following method to obtain the RF company's unending inventory

December 31st divided by the price index.

= $430,080÷1.12

= $384,000

we now minus the sales of the whole year from the inventory.

= $384,000 - $300,000

=$84,000

The RF Company's ending inventory is

= $300,000+$84,000×1.12

= $300,000+$94,080

=$394,080

$394,080 as RF Company's ending inventory

LiRa [457]3 years ago
3 0

Answer:

$394, 080

Explanation:

To calculate the ending inventory of RF Company, we have to first calculate the inventory at year-end (December 31st) divided by the price index.

= \frac{430080}{1.12}  = 384000

Second, we subtract the sales of the year from the inventory at year-end.

= 384000 - 300000 = 84000

To calculate RF Company's ending inventory, we have;

300000 + 84000 * 1.12 = 394080

Therefore, RF Company's ending inventory is $394,080

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