Below is the 2016 financial statements of Kohls Corporation and Dillards Inc., both companies are in the department store industry.

	($ in millions)
	KOHL'S CORP		DILLARD'S INC.
	2016	2015	2016	2015
Balance Sheet:
Inventories	$ 4,038	$ 3,814	$ 1,375	$ 1,374
Income Statement -- 2016:
Net sales	$ 19,204		$ 6,744
Cost of goods sold	$ 12,265		$ 4,351

Required:

Explain purpose of calculating the three ratios (gross profit ratio, Inventory turnover, and average days in inventory) and how the information assists management.

2. Calculate the 2016 the gross profit ratio, inventory turnover, and average days in inventory for each company.

3. Based on your evaluation of the above ratios, which company would you recommend to your client to invest.