Question - Assume that there are two companies identical in every way except that Company A uses FIFO and Company B uses LIFO to value their inventory. If both companies visited a bank for the purpose of obtaining a loan due to rising inventory costs and the bank made its decision based on the highest net income, which company would be better positioned to obtain the loan? What if the bank made its decision based on the highest cash flows associated with the inventory costing method the company uses? Which company would be better positioned to obtain the loan? Elaborate on your responses.