Chapter 17, Problem 2BTN

To determine

Common Size Statement:

The statement which expresses all the accounts in percentage based on sales of total assets is called income size statement.

To determine:

1. Computation of common-size percent for each of the companies.

2. Determine which company retains a higher portion of cumulative net income in the company.

3. Which company has a higher gross margin ratio on sales?

4. Which company holds a higher percent of its total assets as inventory?