During the audit of a dealership selling only new luxury automobiles, the auditors calculated the year 2 and year 1 ratios in the table below.

Select the most reasonable explanation the controller will provide relating to year 2 for each change. An explanation may be used once, more than once, or not at all. Consider each ratio independently?

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Year 2 32 4.01 3.2 10.5% 19.1% Year 1 20 6.32 4.3 12.2% 23.2% Explanations Question 1 Question 2 Question 3 Question 4 Question 5 Ratios Days sales in accounts receivable Inventory turnover Debt to equity Return on assets Net fixed assets to equity