The 2008 annual report of Gannett Co., Inc. (publisher of USA Today and many other newspapers) includes the following in the note that summarizes its accounting policies:
Inventories
Inventories, consisting principally of newsprint, printing ink, plate material, and production film for the company’s newspaper publishing operations, are valued primarily at the lower of cost (first-in, first-out) or market. At certain U.S. publishing operations however, newsprint inventory is carried on a last-in, first-out basis.
Required
1. What types of inventory cost does Gannett carry? What about newspapers? Are newspapers considered inventory?
2. Why would the company choose two different methods to value its inventory?