- The Average Price Of A Gallon Of Gas In 2018 Increased 0 30 12 4 Percent From 242 In 2017 To 2 72 In 2018 Let S Se 1 (38.64 KiB) Viewed 57 times
The average price of a gallon of gas in 2018 increased $0.30 (12.4 percent) from $242 in 2017 to $2.72 in 2018. Let's see whether these changes are reflected in the income statement of Mango Corporation for the year ended December 31, 2018 (amounts in billions). 2018 $ 274 157 Revenues Costs of Purchased Crude Oil and Products Other Operating costs Income before Income Tax Expense Income Tax Expense Net Income 2017 $ 232 124 93 15 83 34 10 $ 24 $ 15 Required: 1. Compute the gross profit percentage for each year. Assuming that the change from 2017 to 2018 is the beginning of a sustained trend, is Mango likely to earn more or less gross profit from each dollar of sales in 2019? 2. Compute the net profit margin for each year. Did Mango do a better or worse job of controlling expenses other than the costs of crude oil and products In 2018 relative to 2017. 3. Mango reported average net fixed assets of $374 billion in 2018 and $372 billion in 2017. Compute the fixed asset turnover ratios for both years. Did the company better utilize its Investment in fixed assets to generate revenues in 2018 or 2017? 4. Mango reported average stockholders' equity of $184 billion in 2018 and $180 billion in 2017. The company has not issued preferred stock. Compute the return on equity ratios for both years. Did the company generate greater returns for stockholders in 2018 or 2017?