Using Inventory Analysis Tools AutoZone and O’Reilly are two competitors in the retail automotive parts industry.

$ thousands AutoZone O’Reilly Average 2015 Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,280,868 $2,592,902 2015 Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,187,3407,966,674 2015 Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,860,309 3,804,031 Average 2014 Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,000,557 $2,464,918 2014 Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,475,3137,216,081 2014 Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,540,406 3,507,180

a. Use the information above to compute the companies’ gross profit margin and days inventory outstanding for both years.

b. Based on these two ratios, which company is more profitable selling its inventory? How has that changed from 2014 to 2015?

c. Based on these two ratios, which company is more efficient with its inventory? How has that changed from 2014 to 2015?