Attached please find Income Statement, Balance Sheet, and footnote 3 on LIFO inventories from ExxonMobil's 2019 Annual Report. Answer the following questions for 2019. 1. Calculate the firm's inventory turnover ratio (COGS/average of beginning and ending inventory). Use "crude oil and product purchases" for COGS, and "Crude oil, products, and merchandise" for inventory. 2. Recalculate the ratio in #1 assuming that the firm used FIFO. 3. Recalculate the ratio in #1 assuming that the firm used LIFO but did not liquidate any inventory (i.e., kept its beginning balance intact). 4. Calculate the firm's approximate inventory inflation rate. 5. How much was the firm's 2019 tax benefit, or penalty (and which one), from LIFO? Assume a 21% tax rate.CONSOLIDATED STATEMENT OF INCOME Note CONSOLIDATED BALANCE SHEET Reference Note Number 2019 2018 2017 Reference Dec. 31 Dec. 31 (millions of dollars) Number 2019 Revenues and other income (millions of dollars) 2015 Sales and other operating revenue 255,583 279,332 237,162 Assets Income from equity affiliates 5,441 7,355 5,380 Current assets Other income 3.914 3.525 1,821 Cash and cash equivalents 3,089 3.042 Total revenues and other income 264.938 290.212 244,363 Notes and accounts receivable, less estimated doubtful amounts 26,966 24,701 Costs and other deductions Inventories Crude oil and product purchases 143,801 156,172 128,217 Crude oil, products and merchandise 14,010 14,803 Production and manufacturing expenses 36,826 36,682 32,690 Materials and supplies 4,518 4,15 Selling, general and administrative expenses 11,398 11,480 10.645 Other current assets 1,469 1,272 Depreciation and depletion 18,998 18,745 19,893 Total current assets 50,052 47.973 Exploration expenses, including dry holes 1,265 1,466 1,790 Investments, advances and long-term receivables 43,164 40,790 Non-service pension and postretirement benefit expense 1,23 1.285 1,745 Property, plant and equipment, at cost, less accumulated depreciation Interest expense 830 766 601 and depletion 253,018 247,101 Other taxes and duties 10 30,525 32,663 30,104 Other assets, including intangibles, net 16,363 10.332 Total costs and other deductions 244,882 259,259 225,689 Total assets 362,597 346,196 Income before income taxes 20,05 30.95 18.674 Income taxes 19 5,282 9.532 (1,174) Liabilities Net income including noncontrolling interests 14,774 21,421 19,848 Current liabilities Net income attributable to noncontrolling interests 434 581 138 Notes and loans payable 20,578 17,258 Net income attributable to ExxonMobil 14,340 20,840 19,710 Accounts payable and accrued liabilities 41,831 37,268 Income taxes payable 1,580 2.612 Earnings per common share (dollars) 12 3.36 4.88 4.63 Total current liabilities 63,989 57,138 Long-term debt 26,342 20,538 Earnings per common share - assuming dilution (dollars) 12 3.36 4.38 4.63 Postretirement benefits reserves 22,304 20,272 Deferred income tax liabilities 25,620 27,244 The information in the Notes to Consolidated Financial Statements is an integral part of these statements. Long-term obligations to equity companies 3,988 4,382 Other long-term obligations 21,416 18,094 Total liabilities 163,659 147,668 Commitments and contingencies Equity Common stock without par value (9,000 million shares authorized, 8,019 million shares issued) 15,637 15,258 Earnings reinvested 421,341 421,653 Accumulated other comprehensive income (19,493) (19,564) Common stock held in treasury (3,785 million shares in 2019 and 3,782 million shares in 2018) (225,835) (225,553) ExxonMobil share of equity 191,650 191,794 Noncontrolling interests 7,288 6,734 Total equity 198,938 198,528 Total liabilities and equity 362,597 346,196 The Information in the Notes to Consolidated Financial Statements is an integral part of these statements.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 2. Accounting Changes Effective January 1, 2019, the Corporation adopted the Financial Accounting Standards Board's Standard, Leases (Topic 842), as amended. The standard requires all leases to be recorded on the balance sheet as a right of use asset and a lease liability. The Corporation used a transition method that applies the new lease standard at January 1, 2019. The Corporation applied a policy election to exclude short-term leases from balance sheet recognition and also elected certain practical expedients at adoption. As permitted, the Corporation did not reassess whether existing contracts are or contain leases, the lease classification for any existing leases, initial direct costs for any existing lease and whether existing land easements and rights of way, which were not previously accounted for as leases, are or contain a lease. At adoption on January 1, 2019, an operating lease liability of $3.3 billion was recorded and the operating lease right of use asset was $4.3 billion, including $1.0 billion of previously recorded prepaid leases. There was no cumulative earnings effect adjustment. Effective January 1, 2020, the Corporation adopted the Financial Accounting Standards Board's update, Financial Instruments - Credit Losses (Topic 326), as amended. The standard requires a valuation allowance for credit losses be recognized for certain financial assets that reflects the current expected credit loss over the asset's contractual life. The valuation allowance considers the risk of loss, even if remote, and considers past events, current conditions and expectations of the future. The standard is not expected to have a material impact on the Corporation's financial statements. 3. Miscellaneous Financial Information Research and development expenses totaled $1,214 million in 2019, $1,116 million in 2018, and $1,063 million in 2017. Net income included before-tax aggregate foreign exchange transaction losses of $104 million and $138 million in 2019 and 2018, respectively, and a gain of $6 million in 2017. In 2019, 2018, and 2017, net income included gains of $523 million and $107 million, and a loss of $10 million, respectively. attributable to the combined effects of LIFO inventory accumulations and drawdowns. The aggregate replacement cost of inventories was estimated to exceed their LIFO carrying values by $9.7 billion and $8.2 billion at December 31, 2019, and 2018, respectively. Crude oil, products and merchandise as of year-end 2019 and 2018 consist of the following: 2019 2018 fowlitout of dollara) Crude oil 5,111 4,783 Petroleum products 5,281 5,666 Chemical products 3.240 3.821 Gas/other 378 533 Total 14.010 14.803