The financial statements of Jean Coutu are presented in Appendix B, following the financial statements for Shoppers Drug Mart in Appendix A.

Instructions

(a) Based on the information in these financial statements, calculate the following ratios for each company for its most recent fiscal year:

1. Profit margin

2. Return on assets

3. Asset turnover

(b) Industry averages for the above three ratios are as follows: profit margin, 2.6%; return on assets, 5.4%; and asset turnover, 2.1 times. What conclusions about the management of assets can be drawn from your results in part (a) and these data?