The following data were extracted from the 2018 financial statements of Penske Automotive Group, Inc. This company operates automobile dealerships, mostly in the United States, Canada, and Western Europe, and commercial truck dealerships in Australia, New Zealand, and the United Kingdom. The company had 536 dealerships as of the end of 2018. Dollar amounts are in millions.

Required
a. Compute Penske’s gross margin percentage for 2018 and 2017.
b. Compute Penske’s average days to sell inventory for 2018 and 2017.
c. How much higher or lower would Penske’s earnings before taxes have been in 2018 if its gross margin percentage had been the same as it was in 2017? Show all supporting computations.

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Revenue Cost of sale Gross profit Operating income before taxes Net income Ending inventory December 31, December 31, 2018 2017 $22,785.1 $21,386.9 19,370.2 18,164.4 3,414.9 3,222.5 604.1 548.2 471.0 613.3 4,040.1 3,944.1