Question 4 [5 points] Use Dylex Corporation's financial statements to compute the gross profit ratio, and indicate whether the change from year to year is favourable or unfavourable. For your analysis, assume that all other things have remained constant. Apply your analysis in very general terms. All values should be accurate to at least two decimal places, Dylex Corporation Income Statement For Years Ended December 31, 2014, 2013, and 2012 2014 2013 2012 Sales $1,060,600 $1,067,300 $1,235,500 Cost of goods sold 902,100 970,400 1,052,400 Gross profit from sales 158,500 96,900 183,100 Operating expenses 62,200 55,700 47,000 Income from operations 96,300 41,200 136,100 Interest expenso 4,650 5,500 4,750 Income before taxos 91,650 35,700 131,350 Income taxes 15,700 4,000 29,100 Not income $75,950 $31,700 $102,250 Dylex Corporation Balance Sheet December 31, 2014, 2013, and 2012 Assets 2014 2013 2012 Cash $47,500 $52,100 $59,000 Short-term investments 42,000 50,000 43,000 Accounts receivable, net 21,600 24,500 29,500 Merchandise inventory 53,900 60,100 66,700 Prepaid expenses 5,800 5,200 5,000 Notes receivable, due in 2017 11,000 13,500 13,500 Plant assets, net 476,000 449,000 443,000 Total assets $657,800 $654,400 $659,700 Liabilities and Equity Accounts payable $44,000 $40,000 $34,800 Salaries payable 12,900 11,100 10,000 Income taxes payable 18,050 22,550 20,250 Long-term note payable secured by mortgage on plant assets 71,000 80,000 85,000 Share capital, 150,000 shares 150,000 140,000 150,000 Retained earnings 361,850 360,750 359,650 Total liabilities and equity $657,800 $654,400 $659,700 2014 2013 Ratio Gross profit ratio (%) Analysis (select one) 2014 2013 Analysis (select one) (select one) favourable unfavourable MARK Jequal