In the Following Information from the 2015 Annual Reports of Focal

question 5

Essay

In the following information from the 2015 annual reports of Focal Point Industries all figures have been rounded to millions of dollars.
Changes in assets and liabilities:
REQUIRED:
1 Explain what the amount "adjustment to LIFO" represents. What effects has this "adjustment" had on Focal
Point Industries' net earnings in 2014 and 2015?
2 What method of determining cash flows from operating activities has Focal Point Industries used in preparing its statement of cash flows? Explain your answer.
3 From 2014 to 2015, what change in the inventory balance increase or decrease occurred in each year as a result of operating activities? What was the effect on the company's cash flow each year as a result of the inventory change?

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Definitions:

Acute Renal Failure

A rapid loss of kidney function that results in the inability to effectively filter waste products from the blood.

Amyotrophic Lateral Sclerosis

A progressive neurodegenerative disease affecting nerve cells in the brain and spinal cord, leading to loss of muscle control.

Priority Problem

An issue identified as having significant importance or urgency, requiring immediate attention or action to prevent or address serious outcomes.

Bradypnea

A slower than normal breathing rate, which might indicate a respiratory or brain condition, requiring further medical examination.