Compute four ratios that measure the ability to earn profits for Gardener Farm Supplies Ltd., whose comparative income statement appears below. Additional data follow.

Did the company's operating performance improve or deteriorate during 2017?

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GARDENER FARM SUPPLIES LTD Income Statement For the Years Ended December 31, 2017 and 2016 2017 2016 Net sales Cost of goods sold Gross margin Selling and general expenses Income from operations Interest expense Income before income tax Income tax expense Net income $195,000 $174,000 91,750 82,250 40,000 42,250 25,400 12,050 30,200 7,550 $ 13,425 $ 22,650 101,500 93,500 50,200 43,300 17,900 4,475 Additional data a. Average total assets b. Average common shareholders' equity c. Preferred dividends d. Number of common shares outstanding 2016 $230,000 $222,000 98,000 5,000 25,000 2017 102,000 5,000 25,000