Federated Department Stores, Inc., is one of the leading operators of full-line department stores in the United States, operating under the names Bloomingdale€™s, The Bon Marche, Burdines, Goldsmith€™s, Lazarus, Macy€™s, and Rich€™s. The following operating data (in millions) for the past three years are taken from Federated€™s income statement:

1. Compute the gross profit for each year.
2. Compute the operating income for each year.
3. Compute the gross profit as a percentage of net sales for each year. Round to one decimal place.
4. Compute the operating income as a percentage of net sales for each year. Round to one decimal place.
5. Based upon this analysis, comment on the trends in operating performance for the past three years.
6. Based upon this analysis, compare Federated€™s operating performance with JCPenney€™s performance shown in this chapter (see Exhibit13).

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For the Years Ended Jan. 31, 2004 $15,264 9,099 Feb. 1, 2003 $15,435 9,255 4,837 Jan. 29, 2005 Net sales Cost of merchandise sold Operating expenses $15,630 9,297 4,933 4,824