Compare Ramirez and Azul by converting their income statements to common size.
Ramirez Azul
Net sales .......................................................... $10,500............... $21,000
Cost of goods sold .............................................. 6,510................. 14,805
Other expense ..................................................... 3,150................... 5,040
Net income .......................................................... $ 840................$ 1,155
Which company earns more net income? Which company's net income is a higher percentage of its net sales?