Key comparative figures for both Best Buy and RadioShack follow.

Required
1. Compute the dollar amount of gross margin and the gross margin ratio for the two years shown for each of these companies.
2. Which company earns more in gross margin for each dollar of net sales? How do they compare to the industry average of 26.5%?
3. Did the gross margin ratio improve or decline for these companies?

Transcribed Image Text:

Best Buy RadioShack Current Prior Current Prior Year (S millions) Year Year Year Revenues (net sales) Cost of sales $45,015 $40,023 $4,224.5 $4,251.7 30,477 2,301.8 34,017 2,225.9