Wise Company Adopted the Dollar-Value LIFO Method on January 1

question 8

Multiple Choice

Wise Company adopted the dollar-value LIFO method on January 1, 2010, at which time its inventory consisted of 6,000 units of Item A @ $5.00 each and 3,000 units of Item B @ $16.00 each.The inventory at December 31, 2010 consisted of 12,000 units of Item A and 7,000 units of Item B.The most recent actual purchases related to these items were as follows: Using the double-extension method, what is the price index for 2010 that should be computed by Wise Company?

• A)108.33%
• B)109.59%
• C)111.05%
• D)220.51%

---

Definitions:

OM Strategies

Refers to the approaches and methodologies a business uses to streamline its operations management processes, including production, inventory control, and quality assurance to improve efficiency and productivity.

Multinational Corporation

A company that operates in multiple countries, managing production or delivering services in more than one country.

Maquiladora

A factory in Mexico run by a foreign company that exports its products to the country of that company, taking advantage of lower labor costs.

Competitive Environment

The dynamic external system in which businesses compete for resources, customers, and market share.