Terry Company had January 1 inventory of $100,000 when it adopted dollar-value LIFO.During the year, purchases were $600,000 and sales were $1,000,000. December 31 inventory atyear-end prices was $143,360, and the price index was 112 (Price Index for base year = 100).What is Terry’s ending inventory and gross profit, respectively?a. $131,360 and 428,000b. $128,000 and 443,460c. $131,360 and 431,360d. $143,360 and 443,460

Question

Terry Company had January 1 inventory of $100,000 when it adopted dollar-value LIFO.
During the year, purchases were $600,000 and sales were $1,000,000. December 31 inventory at
year-end prices was $143,360, and the price index was 112 (Price Index for base year = 100).
What is Terry’s ending inventory and gross profit, respectively?
a. $131,360 and 428,000
b. $128,000 and 443,460
c. $131,360 and 431,360
d. $143,360 and 443,460

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