Westpark Video, Inc., declared bankruptcy. The company reported these figures:

Requirement

1. Evaluate the trend of Westpark Video’s results of operations during 2016 through 2018. Consider the trends of sales, gross profit, and net income. Track the gross profit percentage and the rate of inventory turnover in each year. Also discuss the role that selling expenses must have played in the company’s recent history.

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A1 Westpark Video, Inc. Statements of Income Years Ended December 31 1 2 Millions 3 Sales 4 Cost of sales 5 Selling expenses 6 Other expenses 7 Net income (net loss) 8 Additional data: Ending inventory 2017 35.2 $ 27.5 6.4 0.9 0.4 $ 2018 36.2 $ 28.7 2016 2015 34.3 26.7 8.1 0.1 5.6 0.7 (0.7) $ 1.3 7.6 $ 7.0 $ 8.0 $ 9. 6.4 10