Woollyworm, Incorporated, is one of the world's largest manufacturers of construction, mining, and forestry machinery. The following disclosure note is included in the company's $2019$ financial statements:

C$.$ Inventories $($ $ in millions$)$

Inventories are stated at the lower of cost or net realizable value. Cost is principally determined using the last$-$in$,$ first$-$out $($LIFO$)$ method. The value of inventories on the LIFO basis represented about $60$ percent and $65$ percent of total inventories at December $31,2019$ and $2018,$ respectively. If the FIFO $($first$-$in$,$ first$-$out$)$ method had been in use, inventories would have been $$2,150$ million and $$2,041$ million higher than reported at December $31,2019$ and $2018,$ respectively.

Required:

The company reported LIFO cost of goods sold of $$37,110$ million. Calculate the amount that would be reported for cost of goods sold had Woollyworm used the FIFO inventory method for all of its inventory during $2019.$

Using the cost of goods sold calculated in requirement $1,$ how much higher $($lower$)$ would income before taxes be$,$ if Woollyworm had used the FIFO inventory method for all of its inventory?

Complete this question by entering your answers in the tabs below.Woollyworm, Incorporated, is one of the world's largest manufacturers of construction, mining, and forestry machinery. The following disclosure note is included in the company's $2019$ financial statements:

C$.$ Inventories $($ $ in millions$)$

Inventories are stated at the lower of cost or net realizable value. Cost is principally determined using the last$-$in$,$ first$-$out $($LIFO$)$ method. The value of inventories on the LIFO basis represented about $60$ percent and $65$ percent of total inventories at December $31,2019$ and $2018,$ respectively. If the FIFO $($first$-$in$,$ first$-$out$)$ method had been in use, inventories would have been $$2,150$ million and $$2,041$ million higher than reported at December $31,2019$ and $2018,$ respectively.

Required:

The company reported LIFO cost of goods sold of $$37,110$ million. Calculate the amount that would be reported for cost of goods sold had Woollyworm used the FIFO inventory method for all of its inventory during $2019.$

Using the cost of goods sold calculated in requirement $1,$ how much higher $($lower$)$ would income before taxes be$,$ if Woollyworm had used the FIFO inventory method for all of its inventory?

Complete this question by entering your answers in the tabs below.