Dollar General Corporation operates approximately 9,400 general merchandise stores that feature quality merchandise at low prices to meet the needs of middle-, low-, and fixed- income families in southern, eastern, and midwestern states. For the year ended January 28, 2011, the company reported average inventories of $1,641 (in millions) and an inventory turnover of 5.37. Average total fixed assets were $1,429, and the fixed asset turnover ratio was 9.11.
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Calculate Dollar General's gross profit percentage. What does this imply about the amount of gross profit made from each dollar of sales? TIP: Work backward from the fixed asset turnover and inventory turnover ratios to compute the amounts needed for the gross profit percentage. (Do not round intermediate calculations.
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| 2. |
Did the gross profit percentage increase or decrease from the 33.0 percent earned during the previous year?
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