Trans Canada Motors Ltd. and X Country Trucks Inc. are competitors. The companies reported the following amounts, in millions. In January 2020, you wish to make an investment in one of these companies. Results for 2019 are not yet available.

{Requirements}
1. Compute both companies' gross profit percentage and their rates of inventory turnover during 2020 and 2019 .
2. Can you tell from these statistics which company should be more profitable in percentage terms? Why? What other important category of expenses do the gross profit percentage and the inventory turnover ratio fail to consider?

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1 2 3 4 A Trans Canada Motors Ltd. Statement of Earnings (Amounts in millions) Net sales 5 Cost of sales 6 Selling, general, and administrative expenses 7 B Fiscal Years D E 2020 2019 2018 $ 84.2 $ 73.6 $ 68.9 63.4 55.2 52.6 12.2 11.3 11,2 1 A Trans Canada Motors Ltd. Balance Sheet B C 2 Year-End 3 (Amounts in millions) 2020 2019 2018 4 Assets 5 10 Cash and cash equivalents $ 11.3 $ 16.4 $ 13.9 6 Accounts receivable 13.4 10.9 9.9 7 Inventories 8.0 7.8 6.9 8 E