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Maxi Corporation uses the unit LIFO inventory method. The costs of the company's products have been steadily rising since the company began operations in 2001 and cost increases are expected to continue. The chief financial officer of the company would like to continue using LIFO because of its tax advantages. However, the controller, Sally Hamel, would like to reduce the record keeping costs of LIFO that have steadily increased over the years as new products have been added to the company's product line. Sally suggested the use of the dollar-value LIFO method. The chief financial officer has asked Sally to describe the dollar-value LIFO procedure.
Required:
Describe the dollar-value LIFO procedure.
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