Hello Good Morning, Hope all things are going well on youren

Hello Good Morning, Hope all things are going well on yourend.Here is my Question..Golf Challenge Corp. is a retail sports store carrying golfapparel and equipment. The store is at the end of its second year of operationand is struggling. A major problem is that its cost of inventory hascontinually increased in the past two years. In the first year of operations,the store assigned inventory costs using LIFO. A loan agreement the store haswith its bank, its prime source of financing, requires the store to maintain acertain profit margin and current ratio. The store’s owner is currently lookingover Golf Challenge’s preliminary financial statements for its second year. Thenumbers are not favorable. The only way the store can meet the requiredfinancial ratios agreed on with the bank is to change from LIFO to FIFO. Thestore originally decided on LIFO because of its tax advantages. The ownerrecalculates ending inventory using FIFO and submits those numbers andstatements to the loan officer at the bank for the required bank review. Theowner thankfully reflects on the available latitude in choosing the inventorycosting method.Required1. How does Golf Challenge’s use of FIFO improveits net profit margin and current ratio?2. Is the action by Golf Challenge’s owner ethical?Explain.Thanks In Advance.