has the any of the compact of liquidity is managements, and dubt management is on the por performance of a fim Your bress has asked you to calculate the profitability ratics of Patriary Of Co. and make comments on its second-year performance compared with is fest-year performance The following shows Proxy Olas income statement for the last two years. The company had asut of 54,700 million in the fust year and $7,518 malkon in the second year. Common equity was equal to $2,500 million in the first year, and the company distributed 100% of its warnings out a dividends during the first and the second years. In addition, the fim did not se new stock during the year. Petroxy Oil Co. Income Statement for the Year Ending on December 31 (Millions of dollars) Year 2 Year 1 Net Sales 2,540 2.000 Operating costs except depreciation and amortization 1,120 1,040 Depreciation and motivation 127 Total Operating costs 1,120 Operating Income (or EBIT) 1,293 Less: Interest 175 70 Earnings forels (EBT) 1.118 810 Less: Taxes (25) 280 203 Not Income 602 Calculate the profitability ratio of roxy Oso in the following the Convert al calculations to a perdana randed to two decal places Ratio Value Year 2 Operating margin Year 1 44.00 thom 32.99 12.01 turn on commonly 17.20 Deon makers and analysts lock deeply to profitability is to identify trends in a company's profitably. Profitability ratios veinte both the survey of a company and the benefits that holders. Identify ach of the following statements are true about profitability If a company has a profit margin of 10%, it means that the company earned a net income of $0.10 for each dollar of sales ut a company's operating margin increases but its profit margin decreases, it could mean that the company pald more in interest or taxes An increase in the return on assets ratio implies an increase in the assets a firm owns O a company issues new common shares but its net income does not increase, return on common equity will increase