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Problem
Living Color, Inc. manufactures and distributes house paints. Living Color uses the dollar-value LIFO method. Information for 2014, 2015, and 2016 is presented in the following table. The cumulative price indices for 2014, 2015, and 2016 respectively are 1.0000, 1.0280, and 1.0679.
a. Compute the company's ending inventory using dollar-value LIFO for each year.
b. Prepare the journal entry required to adjust the LIFO reserve for each year.
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