Analyzing Inventory Disclosure Comparing LIFO and FIFO

The current asset section of the 2017 and 2016 fiscal year end balance sheets of The Kroger Co. are presented in the accompanying table:

$ millions	February 3, 2018	January 28, 2017
Current assets
Cash and temporary cash investments	$347	$322
Deposits in-transit	1,161	910
Receivables	1,637	1,649
FIFO inventory	7,781	7,852
LIFO reserve	(1,248)	(1,291)
Assets held for sale	604	-
Prepaid and other current assets	835	898
Total current assets	$11,117	$10,340

In addition, Kroger provides the following footnote describing its inventory accounting policy (assume the following is their complete disclosure): Inventories are stated at the lower of cost (principally on a LIFO basis) or market. In total, approximately 93% of inventories in 2017 and 89% of inventories in 2016 were valued using the LIFO method. Cost for the balance of the inventories, including substantially all fuel inventories, was determined using the FIFO method. Replacement cost was higher than the carrying amount by $1,248 million at February 3, 2018 and $1,291 million at January 28, 2017. We follow the Link-Chain, Dollar-Value LIFO method for purposes of calculating our LIFO charge or credit.

Required: a. At what dollar amount does Kroger report its inventory in its February 3, 2018, balance sheet? $Answer million b. What is the cumulative effect (through February 3, 2018) of the use of LIFO on Krogers pretax earnings? (Show an increase as a positive number and a decrease as a negative number.) $Answer million c. Assuming a 25% tax rate, what is the cumulative (through February 3, 2018) tax effect of the use of LIFO to determine inventory costs? (Show an increase as a positive number and a decrease as a negative number. Round your answers to one decimal place.) $Answer million d. Kroger reported net earnings of $1,907 million in its fiscal year 2017 income statement. Assuming a 25% tax rate, what amount of net earnings would Kroger report if the company used the FIFO inventory costing method? (Round your answers to one decimal place.) $Answer million e. Kroger reported merchandise costs (cost of goods sold) of $95,662 million in fiscal year 2017. Compute its inventory turnover for the year. (Round your answers to one decimal place.) Answer f. Calculate the inventory turnover ratio if the FIFO costing method had been used. (Round your answers to one decimal place.) Answer