Ratio Analysis

The following information was taken from Division Manufacturings December 31st trial balances for this year and the previous year.

	This Year		Previous Year
Accounts receivable	$14,000		$17,000
Accounts payable	22,000		15,000
Cost of goods sold	158,000		124,000
Sales	346,000		239,000
Sales returns	17,000		10,000
Retained earnings	32,000		16,000
Dividends declared and paid	3,000		2,000
Operating income	25,000		18,000
Net income	19,000		18,000

Required:

1. Calculate the gross profit margin and operating margin percentage for this year. Round your answers to two decimal places.

	This Year
Gross profit margin percentage	fill in the blank %
Operating margin percentage	fill in the blank %

2. Assuming that all of the operating expenses are fixed (or, wont change as sales increase or decrease), what will be the operating margin percentage if net sales increase by 30%? Round your answer to two decimal places.

Operating margin percentage

fill in the blank %