Illinois Tool Works reports the following footnote in its 10-K report. The company reports its invento E6-26. Analyzing an Inventory Footnote Disclosure ries using the LIFO inventory costing method. 2018 2017 December 31 (s millions) Raw material.. Work-in-process Finished goods. LIFO reserve. Total inventories. $ 523 161 731 (97) $1,318 $ 465 141 703 (89) $1,220 $1,220 a. What is the balance in inventories reported on the 2018 balance sheet? b. What would the 2018 balance sheet have reported for inventories had the company used FIFO inven tory costing? c. What cumulative effect has the company's choice of LIFO over FIFO had on its pretax income as of year-end 2018? Explain. d. Assume the company has a 35% income tax rate for years prior to 2017 and a 21% rate thereafter. ITW's LIFO reserve was $86 million at December 31, 2016. As of the 2018 year-end, how much has the company saved in taxes by choosing the LIFO over FIFO method for costing inventory? Has the use of LIFO increased or decreased the company's cumulative taxes paid? e. What effect has the use of LIFO inventory costing had on the company's pretax income and tax ex- pense for 2018 only (assume a 21% income tax rate)