You assemble the following information for Henderson Department Store, which computes its inventory under the dollar-value LIFO method.
Cost Retail
Inventory on January 1, 2014 $420,000 $600,000
Purchases 720,000 960,000
Increase in price level for year 5%
Instructions
Compute the cost of the inventory on December 31, 2014, assuming that the inventory at retail is (a)
$619,500 and (b) $745,500.