The following information is from the 2007 annual report of American Greetings Corporation (all dollars in thousands).

The following information comes from the notes to the company's financial statements. Finished products, work in process, and raw material inventories are carried at the lower-of-cost-or-market. The last-in, first-out (LIFO) cost method is used for approximately 65% of the domestic inventories in 2007 and approximately 55% in 2006. The foreign subsidiaries principally use the first-in, first-out method.
Display material and factory supplies are carried at average cost.

Instructions
(a) Define each of the following: finished goods, work in process, and raw materials.
(b) What might be a possible explanation for why the company uses FIFO for its nondomestic inventories?
(c) Calculate the company's inventory turnover ratio and days in inventory for 2006 and
2007. (2005 inventory was $218,711.) Discuss the implications of any change in the ratios.
(d) What percentage of total inventory does the 2007 LIFO reserve represent? If the company used FIFO in 2007, what would be the value of its inventory? Do you consider this difference a "material" amount from the perspective of an analyst? Which value accurately represents the value of the company's inventory?
(e) Calculate the company's 2007 current ratio with the numbers as reported, then recalculate after adjusting for the LIFOreserve.

Feb. 28, 2007 Feb. 28, 2006 Inventories S235,657 15,399 41,456 292,512 79,403 213,109 Finished goods Work in process Raw materials and supplies $207,676 11,315 42,772 261,763 79,145 $182,618 Less: LIFO reserve Total (as reported) Cost of goods sold Current assets (as reported) Current liabilities $826,791 $799,281 $373,000 $846,958 $1,165,845 559,082