Best Buy Co., Inc. reported the following selected information for its three most recent fiscal years (in U.S. $ millions):

____________________________2012 _________2011 __________2010

Net sales ........................ $50,705 .......... $49,747 .......... $49,694

Cost of goods sold ........ 38,132 ............ 37,197 ........... 37,534

Profit from operations .. 1,085 .............. 2,374 ............ 2,235

Profit (loss) .................. (1,231) ............. 1,003 ............. 1,317

Instructions

(a) Calculate the gross profit margin and profit margin for Best Buy for each of the three years.

(b) Comment on whether the ratios have improved or deteriorated over the last three years.

(c) Recalculate the profit margin for the three years using operating income instead of profit. Does this result in a different trend than you saw in part (a)? If yes, what might be the reason for this change?