I find this very difficult and I can't figure it out. Please help. I know it's little lengthy, but I had to attach all of the supporting financial documents.
Deere & Company's Financial Statements:
CNH Global's Financial Statements:
Analysis want to compare Deere's operations for fiscal 2012 to those of an international competitor, CNH ou bal, headquartered in the Netherlands. (CNH Global financial statements follow the Deere Glo cial statements at the end of the case.) In particular, you want to compare a number of inventory- st related metrics. However, the two companies do not use the same inventory costing methods: Deere SLIFO for a large portion of its inventory whereas CNH Global uses FIFO to measure all of its use nventory. CNH Global prepares its financial statements according to U.S. GAAP, but it does not use IFO. In that sense, CNH Global's financial statements report inventory as they would if they followed IFRS, which does not permit the use of LIFO compare the two companies, you first must restate Deere's relevant balance sheet and income tatement numbers from LIFO to FIFO. To do this, we assume that Deere had always used FIFO cost flow method. Use the table below to aggregate the data you need to covert inventory from L these calculations, assume that the marginal tax rate for Deere is 35%. Some data are already provided Deere & Company Net sales LIFO cost of goods sold (COGS) LIFO net income LIFO inventory from the balance sheet LIFO reserve from financial statement notes Total assets from the balance sheet Information from Deere's 2010 financial statements because 2010 balance sheet are not included in the 2012 statement Calculations to convert LIFO to FIFC: IFO to ation and analysis for 2010 and 2011 has been provided as guidance. For 2012 2011 2010 S29,466.1 $23,573.2 21,919.4 17,398.8 1,865.0 4,370.6 3,063.01 1,486.0 1,398.01 48,207.443,266.81 2,799.9 2012 2011 2010 5,856.6 4,461.0 FIFO inventory LIFO inventory + LIFO reserve 49,693.444,664.8 FIFO assets LIFO assets+LIFO reserve Change in LIFO reserve during the year (end- beg.) FIFO COGSLIFO COGS-Change in LIFO reserve After-tax effect of LIFO method (1-Marginal tax rate) 88.0 21,831.4 57.2 Change in LIFO reserve FIFO net income LIFO net income + After-tax effect of LIFO method 2,857.1 ntor Analysis want to compare Deere's operations for fiscal 2012 to those of an international competitor, CNH ou bal, headquartered in the Netherlands. (CNH Global financial statements follow the Deere Glo cial statements at the end of the case.) In particular, you want to compare a number of inventory- st related metrics. However, the two companies do not use the same inventory costing methods: Deere SLIFO for a large portion of its inventory whereas CNH Global uses FIFO to measure all of its use nventory. CNH Global prepares its financial statements according to U.S. GAAP, but it does not use IFO. In that sense, CNH Global's financial statements report inventory as they would if they followed IFRS, which does not permit the use of LIFO compare the two companies, you first must restate Deere's relevant balance sheet and income tatement numbers from LIFO to FIFO. To do this, we assume that Deere had always used FIFO cost flow method. Use the table below to aggregate the data you need to covert inventory from L these calculations, assume that the marginal tax rate for Deere is 35%. Some data are already provided Deere & Company Net sales LIFO cost of goods sold (COGS) LIFO net income LIFO inventory from the balance sheet LIFO reserve from financial statement notes Total assets from the balance sheet Information from Deere's 2010 financial statements because 2010 balance sheet are not included in the 2012 statement Calculations to convert LIFO to FIFC: IFO to ation and analysis for 2010 and 2011 has been provided as guidance. For 2012 2011 2010 S29,466.1 $23,573.2 21,919.4 17,398.8 1,865.0 4,370.6 3,063.01 1,486.0 1,398.01 48,207.443,266.81 2,799.9 2012 2011 2010 5,856.6 4,461.0 FIFO inventory LIFO inventory + LIFO reserve 49,693.444,664.8 FIFO assets LIFO assets+LIFO reserve Change in LIFO reserve during the year (end- beg.) FIFO COGSLIFO COGS-Change in LIFO reserve After-tax effect of LIFO method (1-Marginal tax rate) 88.0 21,831.4 57.2 Change in LIFO reserve FIFO net income LIFO net income + After-tax effect of LIFO method 2,857.1 ntor
