The following note was found in Deeres 2006 financial statements. Based on the following information, and assuming that Deere had pretax income of $1,286.6 million in 2006, answer the following questions

1.If Deere had used the FIFO method to account for its inventory instead of the LIFO method, what would 2006 pretax income have been?

2.Assuming a tax rate of 35%, how much in taxes did Deere save during 2006 because they used LIFO instead of FIFO to account for their inventories?

3.Again assuming a tax rate of 35%, how much in taxes has Deere saved over the life of the company because they used LIFO instead of FIFO to account for their inventories?

The answers for q1,2,3 are: $1,369.6 M, $29.05 M , and $359.8M

please show procedure

Inventories Substantially a inventories owned by Deere & Company and its United States equipment subsidiaries are valued at cost, on the "last-in, first-out" (LIFO) basis. Remaining inventories are generally valued at the lower of cost, on the "first-in, first-out" (FlFO) basis, or market. The value of gross inventories on the LIFO basis represented 83 percent and 79 percent of worldwide gross inventories at FlFO value on October 31, 2006 and 2005, respectively. If all inventories had been valued on a FIFO basis, estimated inventories by major classification at October 31 in millions of dollars would have been as follows Inventories Substantially a inventories owned by Deere & Company and its United States equipment subsidiaries are valued at cost, on the "last-in, first-out" (LIFO) basis. Remaining inventories are generally valued at the lower of cost, on the "first-in, first-out" (FlFO) basis, or market. The value of gross inventories on the LIFO basis represented 83 percent and 79 percent of worldwide gross inventories at FlFO value on October 31, 2006 and 2005, respectively. If all inventories had been valued on a FIFO basis, estimated inventories by major classification at October 31 in millions of dollars would have been as follows