Assume the average cost of computer equipment fell 21.6 percent between 2016 and 2017. Lets see whether these changes are reflected in the income statement of Computer Tycoon Inc. for the year ended December 31, 2017.

Sales Revenues	$	98,000		$	122,233
Cost of Goods Sold		60,200			73,340
Gross Profit		37,800			48,893
Selling, General, and Administrative Expenses		35,000			35,000
Interest Expense		525			410
Income Before Income Tax Expense		2,275			13,483
Income Tax Expense		1,500			4,788
Net Income	$	775		$	8,695

Required: 1-a. Compute the gross profit percentage for each year. (Round your answers to 1 decimal place.)

	2017		2016
Gross profit		%		%

2-a. Compute the net profit margin for each year. (Round your answers to 1 decimal place.)

	2017		2016
Net profit		%		%

3-a. Computer Tycoon reported average net fixed assets of $55,700 in 2017 and $51,100 in 2016. Compute the fixed asset turnover ratios for both years. (Round your answers to 2 decimal places.)

	2017		2016
Fixed asset turnover ratio		times		times

4-a. Computer Tycoon reported average shareholders equity of $55,500 in 2017 and $42,300 in 2016. Compute the return on equity ratios for both years. (Round your answers to 1 decimal place.)

	2017		2016
Return on equity (ROE)		%		%

4-b. Did the company generate greater returns for shareholders in 2017 than in 2016?

multiple choice

Yes

No