b. Prepare the December 31 year-end journal entry for Year 5 Year 6, and Year 7, to convert inventory from FIFO to LIFO.Ohio Inc. maintains its internal inventory records on a FIFO basis. On January 1 of Year 5, Ohio changed to dollar-value LIFO for external reporting and income tax purposes. The following data are available for Ohio Inc.'s inventory. Its base inventory is $200,000.Ending inventory at current-year cost... LIFO price index..Year 5$280,000 1.20Year 6$320,000 1.30Year 7$350,0001.45Requireda. Compute its ending inventory on a dollar-value LIFO basis for Year 5 Year 6, and Year 7.b. Assume that its Year 8 ending inventory on a dollar-value LIFO basis is $288,390 and its Year 8 LIFO price index is 1.50. What is its Year 8 ending inventory on a current cost basis? b. Prepare the December 31 year-end journal entry for Year 5, Year 6, and Year 7, to convert inventory fromFIFO to LIFO.Ohio Inc. maintains its internal inventory records on a FIFO basis. On January 1 of Year 5, Ohio changed todollar-value LIFO for external reporting and income tax purposes. The following data are available for OhioInc.'s inventory. Its base inventory is $200,000.Ending inventory at current-year cost..LIFO price index..*****Year 5$280,0001.20Year 6$320,0001.30Year 7$350,0001.45Requireda. Compute its ending inventory on a dollar-value LIFO basis for Year 5, Year 6, and Year 7.b. Assume that its Year 8 ending inventory on a dollar-value LIFO basis is $288,390 and its Year 8 LIFO priceindex is 1.50. What is its Year 8 ending inventory on a current cost basis?

LIFO (Last in first out) This method is based on the idea that the most recent purchases in your…

Answered: basis. On January 1 of Year 5, Ohio…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter7: Inventories: Cost Measurement And Flow Assumptions

Section: Chapter Questions

Problem 14RE: On January 1 of Year 1, Dorso Company adopted the dollar-value LIFO method of inventory costing....

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b. Prepare the December 31 year-end journal entry for Year 5 Year 6, and Year 7, to convert inventory from FIFO to LIFO. Ohio Inc. maintains its internal inventory records on a FIFO basis. On January 1 of Year 5, Ohio changed to dollar-value LIFO for external reporting and income tax purposes. The following data are available for Ohio Inc.'s inventory. Its base inventory is $200,000. Ending inventory at current-year cost... LIFO price index.. Year 5 $280,000 1.20 Year 6 $320,000 1.30 Year 7 $350,000 1.45 Required a. Compute its ending inventory on a dollar-value LIFO basis for Year 5 Year 6, and Year 7. b. Assume that its Year 8 ending inventory on a dollar-value LIFO basis is $288,390 and its Year 8 LIFO price index is 1.50. What is its Year 8 ending inventory on a current cost basis?

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