a What is the working capital at the end of

a. What is the working capital at the end of 2008?b. What is the balance in the LIFO reserve
account at the end of 2008? Describe this account.c. If the LIFO reserve account was added to
the inventory at LIFO, what would be the resulting inventory number at the end of 2008? Which
inventory amount do you consider to be more realistic?d. Does the use of LIFO or FIFO produce
higher, lower, or the same income during (1) Price increases; (2) Price decreases; and (3)
Constant prices? (Assume no decrease or increase in inventory quantity.)e. Does the use of
LIFO or FIFO produce higher, lower, or the same amount of cash flow during (1) Price
increases; (2) Price decreases; and (3) Constant costs? Answer the question for both pretax
cash flows and after-tax cash flows. (Assume no decrease or increase in inventory quantity.)f.
Assume that the company purchased inventory on the last day of the year, beginning inventory
equaled ending inventory, and inventory records for the item purchases were maintained
periodically on the LIFO basis. Would that purchase be included on the income statement or the
balance sheet at year-end?g. Explain how liquidation of LIFO layers generatesincome.
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a What is the working capital at the end of
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