Analyzing Inventory Disclosure Comparing LIFO & FIFOThe current asset section of the 2014 and 103 fiscal year end balance sheet of The Kroger Co are presented in the accompany tables: a. At what dollar amount does Kroger report its inventory in its Jan. 31, 205 balance sheet? b. What is the cumulative effect (through Jan. 31, 2015) of the use of LIFO on Kroger’s pretax earning? c. Assuming a 35% tax rate, what is the cumulative (through Jan. 31, 2015) tax effect of the use of LIFO to determine inventory costs?d. Kroger reported net earnings of $1,728 million in its fiscal year 2014 income statement. Assuming a 35% tax rate, what amount of net earnings would Kroger report if the company is using FIFO inventory costing methods?e. Kroger reported merchandise cost of $85,512 M in fiscal year 2014. Compute the inventory turnover for the year.f. How would the inventory turnover ratio differ if the FIFO costing method had been used? Current asset (in millions)                    Jan. 31,2015                   Feb. 1, 2014Cash & temporary cash investment            268                         401Deposits in transit                                       988                         958Receivables                                                1,266                       1,116FIFO Inventory                                            6,933                          6,801LIFO credit                                                   (1,245)                     (1,150)Prepaid & other current assets                   701                               704Total current Assets                                     8,911                          8830

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Analyzing Inventory Disclosure Comparing LIFO & FIFO
The current asset section of the 2014 and 103 fiscal year end balance sheet of The Kroger Co are presented in the accompany tables:
a. At what dollar amount does Kroger report its inventory in its Jan. 31, 205 balance sheet?
b. What is the cumulative effect (through Jan. 31, 2015) of the use of LIFO on Kroger’s pretax earning?
c. Assuming a 35% tax rate, what is the cumulative (through Jan. 31, 2015) tax effect of the use of LIFO to determine inventory costs?
d. Kroger reported net earnings of $1,728 million in its fiscal year 2014 income statement. Assuming a 35% tax rate, what amount of net earnings would Kroger report if the company is using FIFO inventory costing methods?
e. Kroger reported merchandise cost of $85,512 M in fiscal year 2014. Compute the inventory turnover for the year.
f. How would the inventory turnover ratio differ if the FIFO costing method had been used?

Current asset (in millions)                    Jan. 31,2015                   Feb. 1, 2014
Cash & temporary cash investment            268                         401
Deposits in transit                                       988                         958
Receivables                                                1,266                       1,116
FIFO Inventory                                            6,933                          6,801
LIFO credit                                                   (1,245)                     (1,150)
Prepaid & other current assets                   701                               704
Total current Assets                                     8,911                          8830

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