Chapter 13, Problem 5QS

To determine

Common size Financial Statements:

It refers to all the items of financial statements that are represented in a common basis. Balance sheets are commonly sized based on the expression that represents all items as percentage of its total assets or equities.
The formula to calculate common size percent is,

$\text{Common}\text{Size}\text{Percent}=\frac{\text{Analysis}\text{Pereiod}\text{Amount}}{\text{Base}\text{Period}\text{Amount}}\times 100\%$

To identify: The 2016 and 2017 common-size percents for cost of goods sold using net sales as the base