Problem 4: In the following information from the 2021 annual reports of Focal Point Industries all figures have been rounded to millions of dollars. Balance Sheet Data Raw material inventory Work in process inventory Finished goods inventory Inventories at FIFO May 31, 2021 $ 25.8 May 31, 2020 $ 52.1 44.8 1,132.7 34.7 1,303.8 1,203.3 1,390.6 Adjustment to LIFO 5.6 21.9 Net inventories reported 1,197.7 1,368.7 Income Statement Data Net sales Cost of goods sold $920.0 600.0 $900.0 550.0 Questions/Requirements: a) What inventory method or methods does the company use? Explain how you can tell. b) Briefly explain what is meant by "cost" when referring to inventory under GAAP, and why such methods as FIFO and LIFO had to be developed. c) Explain what the amount "adjustment to LIFO" represents. What effects has this "adjustment" had on Focal Point Industries' net earnings in 2020 and 2021? Explain in detail. d) Calculate the gross profit percentage and the profit margin for each year. Show each calculation. Comment on the trends.