This information is available for the Automotive and Other Operations Divisions of General Motors Corporation for 2006. General Motors uses the LIFO inventory method.
(in millions) 2006
Beginning inventory $13,862
Ending inventory 13,921
LIFO reserve 1,508
Current assets 64,131
Current liabilities 67,822
Cost of goods sold 164,682
Sales 172,927
(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.