5. Profitability ratios Is Profitability ratios help in the analysis of the combined impact of liquidity ratios, asset management ratios, and debt management ratios on the operating performance of a fom. Your boss has asked you to calculate the protability ratios of Petroxy Oil Cod and make comments on its second year performance as compared with its first year performance The following shows Petroxy Oil Co's income statement for the last two years. The company had assets of $9,400 million in the first year and $15,037 million in the second year. Common equity was equal to $5,000 million in the first year, and the company distributed 100% of its earnings out as tidends during the first and the second years. In addition, the firm did not issue new stock churing the year actory Petroxy Oil Co. Income Statement for the Year Ending on December 31 (Millions of dollars) Year Year! Net Sales 5.080 4,000 Operating costs except depreciation and mortation 1.610 1,495 Depreciation and morta 254 160 Total Operating costs Operating income for ET) 3.256 2.145 434 305 before (EST) 2.78 2,040 Les 25 510 The income 2.00 1,500 y Tools Calculate the profitability rates of Petroxy oil on the following table Convert al calculations to a percentage rounded to two decimal places Ratio Value Year Year 1 Tips Operating margin 4100 Tips Return on totalt Runon common 16209 30.00 OU 21.09 pols Decision makers and ass look into profitability is to del rendin e con profitability Probability to give it to Ith the survivabaty of a company and the benefits that shareholders receive Identity which of the following statements are rebout profitability rats. Check at that any Troductory Aeroperating than the industry average indicates the lower penting her product pricing, or both tt a company operating margin increases but its profit margin decretold me that the company and more in interest or tanes An increase in the return to implies increase in the assessors of a company issues woman share but its net income does not increase return on common city will increase