Question: Zhou Inc. operates a retail operation that purchases and sells snowmobiles, among other outdoor products. The company purchases all inventory on credit and uses a periodic inventory system. The Accounts Payable account is used for recording inventory purchases only; all other current liabilities are accrued in separate accounts. You are provided with the following selected information for the fi scal years 2015 through 2018, inclusive.
Instructions: (a) Calculate the missing amounts.
(b) The vice presidents of sales, marketing, production, and finance are discussing the company's results with the CEO. They note that sales declined over the 3-year fiscal period, 2016-2018. Does that mean that profitability necessarily also declined? Explain, computing the gross profit rate and the profit margin for each fiscal year to help support your answer.