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Please elaborate what will happen to Net Earnings to Sales and Net Earnings to Total Book Assets when you observe these trends. (a) and (b)

  1. Please elaborate what will happen to Net Earnings to Sales and Net Earnings to Total Book Assets when you observe these trends. (a) and (b) are separate unrelated circumstances.
  1. Sales increased by a total of 30% in the prior three years, while Days of Sales in Inventories increased also by 30% in each of these three years. Costs of Goods Sold to Sales remained constant.
  2. Gross property, plant, and equipment increased by a total of 30% during the prior three years. Operating and administrative expense increased relative to sales by 30% in the prior three years. Sales remained constant. Costs of goods sold to sales remained constant.

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