Solution-Compare the statements of companies of unequal size

Compare the statements of companies of unequal size

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Reference no: EM131569070

Problem -

Common-size percentages are often used to compare the statements of companies of unequal size. The condensed income statements of Companies A and B are given below. Enter in the spaces provided the amounts expressed in common-size percentages.

Company A and Company B Income Statements for Year Ended December 31, 2007
	Dollar Amounts		Common-Size Percentages
	Company A	Company B	Company A	Company B
Sales	$450,000	$525,000
Cost of goods sold	261,000	210,000
Gross margin	$189,000	$315,000
Selling expenses	$81,000	$89,250
Administrative expenses	45,000	52,500
Total operating expenses	$126,000	$141,750
Income	$63,000	$173,250

After expressing the amounts of the income statements in common-size percentages, examine them and name the company that operated more efficiently.

Reference no: EM131569070

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Compare the statements of companies of unequal size

Reference no: EM131569070

Reference no: EM131569070

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