Handley Grocery Corporation reported the following information in its comparative financial statements for the fiscal year ended January 31, 2018:

Requirements

1. Compute the net profit margin ratio for the years ended January 31, 2018, and 2017. Did it improve or worsen in 2018?

2. Compute asset turnover for the years ended January 31, 2018, and 2017. Did it improve or worsen in 2018?

3. Compute return on assets for the years ended January 31, 2018, and 2017. Did it improve or worsen in 2018? Which component—net profit margin ratio or asset turnover—was mostly responsible for the change in the company’s return on assets?

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January 31, January 31, 2017 2018 Net sales. .. Net earnings. Average total assets.. $50,000 $48,350 $ 2,100 $ 2,200 $40,000 $39,300