LIFO Inventory Computation
White Farm Supply’s records for the first three months of its existence show purchases of commodity Y2 as follows:
|
|
Number of Units |
Cost |
|
August |
5,500 |
$28,050 |
|
September |
8,000 |
41,600 |
|
October |
5,100 |
27,030 |
The inventory of commodity Y2 at the end of October using FIFO is valued at $36,390.
1. Assuming that none of commodity Y2 was sold during August and September, what value would be shown at the end of October if LIFO cost was assumed?
2. If White Farm uses LIFO, what disclosure could it make in its October 31 quarterly report concerning the FIFO value of inventory?