Refer to the financial statements of American Eagle Outfitters given in Appendix B at the end of this book, or open file AEOS.pdf in the Annual Report Cases directory on the student CD-ROM.

How much inventory does the company hold at the end of the current year?

Estimate the amount of merchandise that the company purchased during the current year.

{Hint: Use the cost of goods sold equation and ignore "certain buying, occupancy, and warehousing expenses.")

What method does the company use to determine the cost of its inventory?

What was the change in inventory? How did it affect net cash provided by operating activities for the current year?