Bond Company adopted the dollar-value LIFO inventory method on January 1, 2016. In applying the LIFO method, Bond uses internal cost indexes and the multiple-pools approach. The following data were available for Inventory Pool No. 3 for the two years following the adoption of LIFO: Under the dollar-value LIFO method the inventory at December 31, 2017, should be:.a) $362,750. b) $355,000. c) $356,150. d) None of these answer choices is correct.

a) $362,750

Explanation:

The computation of inventory is shown below:-

Year      Inventory at    Change in     Cost    Layer at   Ending

                  base          layer at base               current

1-1-2016    304,500          304,500       1.00                      304,500

31-12-2016 327,500            23,000        1.05      24,150    328,650

                              (327,500 - 304,500)

31-12-2017  355,000         27,500           1.24      34,100     362,750

                             (355,000 - 327,500)

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