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To: Geoff Nunn who wrote (46567)	6/7/1998 3:38:00 AM
From: Chuzzlewit	Read Replies (2) \| Respond to of 176387

Geoff, that's an interesting thought. Using your heuristic of a loss of 1% per week the value of the loss in inventory held for one year would be 1-(1-.01)^52=41%. However, the time held in inventory is so short that I don't think any loss is meaningful. In any event, it would be approximately .005%N where N is the number of turnsaverage inventory. At the end of the last quarter the inventory stood at around 254MM, so the savings would be roughly $116MM. Assuming an income tax rate of 30% this would bring $81MM to the bottom line. With 700MM diluted shares o/s this would add around $.12 to the bottom line. This makes sense if you assume that inventory depreciates that rapidly and on a steady basis. If that's true, wow! TTFN, CTC