The notes to the financial statements are an integral part of the financial statements. They immediately follow the financial statements. The first note is normally the longest and includes discussion of all the following items EXCEPT: The cost flow assumption the company uses for costing inventory on the balance sheet (i.e. FIFO, LIFO. weighted-average method) O The depreciation method used for property and equipment (i.e., straight-line, double-declining balance) O Lawsuits the company faces O The point in which revenue is recognized from retail sales in its stores