Question

Calculate the inventory value at the end of 2024 and 2025 using the dollar-value LIFO retail method. Note: Round your answers to the nearest whole dollar amount.

a) $30,420 and $37,920
b) $30,000 and $38,000
c) $31,000 and $37,000
d) $30,500 and $37,500

Answer 1

Calculating inventory values with dollar-value LIFO retail method requires specific data not provided in the question. This method accounts for inflation to adjust inventory value but cannot be accurately done without more information.

Step-by-step explanation:

The student's question pertains to calculating inventory values using the dollar-value LIFO retail method, which is a technique used in accounting to measure the cost of inventory that a company has at the end of a period. However, to provide an answer, we would typically need more specific data, such as the cost-to-retail ratio, opening inventory value, and the prices or costs associated with the inventory during the given years. Without this data, it is not possible to perform an accurate calculation or to select one of the provided answers (a-d). This method is used to adjust inventory values considering price fluctuations, preventing inflation from artificially inflating profits. It is important to note that such calculations can involve complex numbers and may require the use of index numbers to simplify the process and facilitate comparisons over time.