(Answered) A wholly owned subsidiary of j amp j products implemented

Accounting

A wholly owned subsidiary of J & J Products implemented Dollar Value LIFO inventory valuation in 2010, when their ending inventory was $650,000. The following are the inventory amounts for an ingredient used in packaging for years 2011 - 2015. The price index has been increasing by 5% each year 2011 through 2015.

Price index 1.05 first year
Inventory at price index
Year End of Year
Year Prices
2011 $497,200 1.05 the following years increase 5%
2012 $595,800
2013 $605,200
2014 $656,500
2015 $701,800

Calculate the ending inventory for years 2011 - 2015 using Dollar Value LIFO.

Note:

I calculated the 1.05*5% and I got 1.1025 but the professor said that it is less than this, and also he said that it should be calculated as compounded. Can you help me ?

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