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The average price of a gallon of gas in 2018 increased $0.30 (12.4 percent) from $2.42 in 2017 to $2.72 in 2018. Lets see whether

The average price of a gallon of gas in 2018 increased $0.30 (12.4 percent) from $2.42 in 2017 to $2.72 in 2018. Lets see whether these changes are reflected in the income statement of Fawkes Manufacturing for the year ended December 31, 2018 (amounts in billions). 2018 2017 Revenues $ 204 $ 172 Costs of Purchased Crude Oil and Products 117 92 Other Operating Costs 61 69 Income before Income Tax Expense 26 11 Income Tax Expense 7 Net Income $ 19 $ 11 Required: Compute the gross profit percentage for each year. Assuming the change from 2017 to 2018 is the beginning of a sustained trend, is Fawkes likely to earn more or less gross profit from each dollar of sales in 2019? Compute the net profit margin for each year. Did Fawkes do a better or worse job of controlling expenses other than the costs of crude oil and products in 2018 relative to 2017? Fawkes reported average net fixed assets of $354 billion in 2018 and $352 billion in 2017. Compute the fixed asset turnover ratios for both years. Did the company better utilize its investment in fixed assets to generate revenues in 2018 or 2017? Fawkes reported average stockholders equity of $164 billion in 2018 and $160 billion in 2017. The company has not issued preferred stock. Compute the return on equity ratios for both years. Did the company generate greater returns for stockholders in 2018 or 2017

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