Question

QV-TV, Inc. provided the following items in its notes to the financial statements for the year-end 2019: Cost of goods sold was $22 billion under FIFO costing and the inventory value under FIFO costing was $2.1 billion. The LIFO Reserve for year-end 2018 was $0.6 billion and at year-end 2019 it had increased to $0.8 billion. What is the LIFO inventory value at year-end 2019?

Answer 1

Answer:

$1.3 million

Explanation:

Under FIFO costing:

Cost of goods sold = $22 billion

Inventory = $2.1 billion

LIFO Reserve for year-end 2018 = $0.6 billion

At year-end 2019 it had increased to $0.8 billion

Ending inventory (LIFO) = Ending inventory (FIFO) - Ending period LIFO reserve

                                        = $2.1 billion - $0.8 billion

                                        = $1.3 million