Reference no: EM132560542

The current assets of Exxon Mobil Corporation follow:

                                                                                                                        2014                          2013

Current assets

Cash and cash equivalents                                                                $13,068              $8,453

Notes and accounts receivable, less estimated doubtful amounts              $38,642              $32,284

Inventories

Crude oil, products and merchandise                                                      $12,665          $10,852

Materials and supplies                                                                             $3,359              $3,124

Other current assets                                                                             $6,229                 $5,271

Total current assets                                                                                $73,963                 $59,984

Question 1: Exxon Mobil reported pretax earnings of $73,257 million in 2014. What amount of pretax earnings would have been reported by the company if inventory had been reported using the FIFO costing

Question 2: Exxon Mobil reported cost of goods sold of $266,534 million in 2014. Compute its inventory turnover ratio for 2014 using total inventories (Round your answer to one decimal place.) (I got the answer and its correct (11.1)

Question 3: BP, p.l.c. (BP) reports its financial information using IFRS. For fiscal year 2014, BP reported cost of goods sold of $288,618 million, beginning inventory of $26,218 million and ending inventory of $25,661 million. Compute BP's inventory turnover ratio for fiscal year 2014. (Round your answer to one decimal place.) (I got the answer and its correct (11.1)

Question 4: Compare your answers in parts b and c. BP can't use LIFO to report under IFRS, so, revise your calculations in such a way as to find out which company has faster inventory turnover. (Hint: Calculate Exxon Mobil's inventory turnover ratio as if Exxon Mobil used the FIFO costing method.)(Round your answer to one decimal place.)