Suppose That Badger's 2014 Ending Inventory, Valued at Year-End Costs

Multiple Choice

Suppose that Badger's 2014 ending inventory, valued at year-end costs, was $143,000 and that the relative cost index for this inventory in 2014 was 1.10. In determining the inventory balance should Badger report in its 12/31/14 balance sheet:

A) An additional layer of $23,000 is added to the 1/1/14 balance.
B) An additional layer of $22,000 is added to the 1/1/14 balance.
C) An additional layer of $11,000 is added to the 1/1/14 balance.
D) None of the above is correct.