Profitability ratios help in the analysis of the combined impact of liquidity ratios, asset manogement ratios, and debt management ratios on the operating performance of a firm. Your boss has asked you to calculate the profitability ratios of Blue Sky Drone Company and make comments on its second-year performance as compared to its first-year performance. The following shows Blue Sky Drone's income statement for the last two years. The company had assets of $3,525 million in the first year and $5,638.80 million in the second year. Common equity was equal to $1,875 milion in the first year, and the company distributed 100% of its earning5 out as dividends during the first and the second years. In addition, the firm did not issue new stock during elther year. Blue Sky Drone Company Income Statement For the Year Ending on December 31 (Millions of dollars) Calculate the profitability ratios of Blue Sky Drone Company in the following table. Convert all caiculations to a percentage rounded to two decimal piacesi, Decision makers and analysts look deeply into profitability ratios to identify trends in a company's profitability, Profitability ratios give insights into both the survivability of a company and the benefits that sharehoiders receive, Identify which of the following statements are true about profitability retios. check alf that apply. A higher operating profit margin than the industry average indicates either lower operating costs, higher product pricing, or both. If a company's operating margin increases but its profit margin decreases, it could mean that the company paid more in interest or taxes: An increase in a company's earnings means that the net profit margin is increasing. If a company issues new common shares but its net income does not increase, return on common equity will increase