Common-size statement analysis A common-size income statement for Creek Enterprises’ 2021 operations follows. Using the firm’s 2022 income statement presented in Problem 3–16, develop the 2022 common-size income statement and compare it with the 2021 common-size statement. Which areas require further analysis and investigation?

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Creek Enterprises Common-Size Income Statement for the Year Ended December 31, 2021 Sales revenue ($35,000,000) Less: Cost of goods sold Gross profits Less: Operating expenses Selling expense General and administrative expenses Lease expense Depreciation expense Total operating expense Operating profits Less: Interest expense Net profits before taxes Less: Taxes (rate = 21%) Net profits after taxes Less: Preferred stock dividends Earnings available for common stockholders 100.0% 65.9 34.1% 12.7% 6.3 0.6 3.6 23.2% 10.9% 1.5 9.4% 2.0 7.4% 0.1 7.3%