Question

Dollar-Value LIFO Retail Johns Company adopts the dollar-value LIFO retail inventory method on January 1, 2016....

Dollar-Value LIFO Retail

Johns Company adopts the dollar-value LIFO retail inventory method on January 1, 2016. The following information for 2016 is obtained from Johns' records:

 Cost Retail Inventory, January 1, 2016 \$20,000 \$29,000 Purchases 60,000 92,000 Net additional markups — 1,000 Net markdowns — 3,000 Sales — 75,000

The price index on January 1, 2016, was 100, and on December 31, 2016, it was 110.

Required:

Compute the cost of the inventory on December 31, 2016. Round the cost-to-retail ratio to three decimal places.

 JOHNS COMPANY Calculation of cost of inventory using Dollar-Value LIFO December 31, 2016 Cost Retail Beginning inventory \$20,000 \$29,000 Purchases 60,000 \$92,000 Add: Markups (net) 1,000 Less: Markdowns (net) 3,000 \$90,000 Goods available for sale \$80,000 \$119,000 Less: Sales 75,000 Ending inventory at retail ????? \$44,000 Ending inventory at cost \$40,000

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