Question

Company utilizes the LIFO retail inventory method. Its cost-to-retail percentage is 60% based on beginning inventory and 64% based on current-period purchases. The company determined that during the current period a new layer was added with retail value of $50,000. The new layer at cost should be_________.

Answer 1

new layer at cost = $32000

Step-by-step explanation:

given data

cost-to-retail percentage

beginning inventory = 60%

current period purchases = $50,000

retail value = $50,000

solution

we get her new layer at cost that should be here as

new layer at cost = retail value × current period purchases ......................1

put here value ans we will get

new layer at cost = $50,000 × 64%

new layer at cost = $32000