Use the financial data below from XYZ, Inc. to answer the three questions below. Note that the reported figures are in thousands of dollars:

2015 2014

Inventory $219,686.00 $241,154.00

Cost of Sales $54,661.00 $675,138.00

Net Income $31,185.00 $64,150.00

Tax Rate 37% 37%

Note: If the first-in, first-out (FIFO) method of accounting for inventory had been used, inventory would have been approximately $26.9 million and $25.1 million higher than reported at 2015 and 2014, respectively.

1.What would the ending inventory have been in 2014 and 2015 had FIFO been used?

2. What would be the net income for the year ending in 2015 had FIFO been used?

3. Discuss the usefulness of LIFO to FIFO restatements for analysis purposes.