Answered

The January 28 (fiscal y ear-end) financial statements of Collette, Inc. reported the following information (in millions). Cost of sales Inventories, net LIFO reserve Year2 $1,213,918 468,611 3,476 Year1 $1,223,622 437,396 3,275 If Collette had used the FIFO method of inventory costing, Year 2 inventory would have been: A) $465, 135 million B) $472,087 million C) $468,812 million D) $405,482 million E) None of these are correct.

Answer :

Answer:

B) $472,087 million

Explanation:

The computation of the year 2 inventory is shown below

= LIFO inventory + LIFO reserve

= 468,611 + $3,476

= $472,087 million

We simply added the lifo inventory and lifo reserve of year 2 in order to determine the year 2 inventory

Hence, the correct option is B.

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