Answer:
2022 ending inventory 229,200
2023 ending inventory 278,420
2024 ending inventory 266,920
Explanation:
Year at Year-End Costs ////// at Base Year Costs
2022 $ 239,400 $ 228,000
2023 $ 312,800 $ 272,000
2024 $ 314,400 $ 262,000
2022:
239,400 / 228,000 = 1.05 price index
Layers:
204,000 at 1.00 = 204,000
(228,000 - 204,000) x 1.05 = 25,200
Total Inventory 229,200
2023:
312,800 / 272,000 = 1.15 price index
Layers
204,000 at 1.00 204,000
24,000 at 1.05 25,200
(272,000 - 229,200) x 1.15 = 49,220
Total Inventory 278,420
2024:
As the base inventory decreased we have to decrease previous layer rather than create a new one.
204,000 at 1.00 204,000
24,000 at 1.05 25,200
( 262,000 - 229,200 ) x 1.15 37,720
Total Inventory 266,920
