This information (in millions) is available for the Automotive and Other Operations Divisions of… 1 answer below »

This information (in millions) is available for the Automotive and Other Operations Divisions of General Motors Corporation for a recent year. General Motors uses the LIFO inventory method.

Beginning inventory

$13,921

Ending inventory

14,939

LIFO reserve

1,423

Current assets

60,135

Current liabilities

70,308

Cost of goods sold

166,259

Sales revenue

178,199

Instructions

(a) Calculate the inventory turnover ratio and days in inventory.

(b) Calculate the current ratio based on inventory as reported using LIFO.

(c) Calculate the current ratio after adjusting for the LIFO reserve.

(d) Comment on any difference between parts (b) and (c).

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