Inventories are stated at lower of cost and net realizable value, and valued on either an average or a specific identification cost basis. In some instances, the Company ships products directly from its suppliers to the customer, with the related inventory and cost of sales recognized on a specific identification basis. Inventory costs primarily consist of product cost from the Company's suppliers, as well as inbound freight, import duties, taxes, insurance, logistics and other handling fees.

What inventory cost flow method does the company use? If it uses LIFO, how did the choice of LIFO versus FIFO affect their income this year? Reconstruct all of the inventory entries that were made during the year (if the company uses LIFO, use a LIFO reserve account).

Inventory balances of $6,854 million and $7,367 million as of May 31, 2021 and 2020, respectively, were substantially all finished goods.

2021 2020 2019

Cost of sales 24,576 21162 21643