Use the Following Information for

question 58

Multiple Choice

Use the following information for
Hay 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 $126,500, and the price index was 110.
-What is Hay Company's ending inventory?

• A)$110,000.
• B)$115,000.
• C)$116,500.
• D)$126,500.

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Definitions:

Real Gross Domestic Product

An inflation-adjusted measure that reflects the value of all goods and services produced by an economy in a given year.

Price Index

A statistical measure that examines the weighted average of prices of a basket of consumer goods and services, used as an indicator of inflation and deflation.

Nominal GDP

The market value of all final goods and services produced within a country in a given period, measured in current prices.

Real GDP

The total value of all goods and services produced by an economy adjusted for inflation, offering a more accurate reflection of an economy's size and growth rate.