Use the Common-Size Income Statement below for Company Y and Company Z to answer this question....

  

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Use the Common-Size Income Statement below for Company Y and Company Z to answer this question. Which of the following reasons explain why Company Y has a higher operating profit margin? Indicate all the answers that are correct. O Company Y has a higher markup and/or lower inventory costs. Company Y has higher tax expense relative to sales Company Y has less interest expense relative to sales. O Company Y does a better job controlling their operating expenses. Net Sales Cost of sales Gross Profit Selling General & Admin Operating Profit Interest Expense Earnings Before Taxes Tax Expense Net Income Company 41717 29846 11871 7455 4416 10 4406 1134 3272 Common Company Common Size Z Size 100.00% 15524 100.00% 9932 5592 4808 784 102 71.54% 28.46% 17.87% 10.59% 0.02% 10.56% 2.72% 7.84% 682 186 496 63.98% 36.02% 30.97% 5.05% 0.66% 4.39% 1.20% 3.20% Use the Common-Size Income Statement below for Company Y and Company Z to answer this question. Which of the following reasons explain why Company Y has a higher operating profit margin? Indicate all the answers that are correct. O Company Y has a higher markup and/or lower inventory costs. Company Y has higher tax expense relative to sales Company Y has less interest expense relative to sales. O Company Y does a better job controlling their operating expenses. Net Sales Cost of sales Gross Profit Selling General & Admin Operating Profit Interest Expense Earnings Before Taxes Tax Expense Net Income Company 41717 29846 11871 7455 4416 10 4406 1134 3272 Common Company Common Size Z Size 100.00% 15524 100.00% 9932 5592 4808 784 102 71.54% 28.46% 17.87% 10.59% 0.02% 10.56% 2.72% 7.84% 682 186 496 63.98% 36.02% 30.97% 5.05% 0.66% 4.39% 1.20% 3.20%

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Solution Based on the CommonSize Income Statement the following reasons explain why Com... View the full answer