The summarized profit and loss statement of Vroom Auto Limited, manufacturer of motor cycles is given as follows: 

You are required to:

1. Prepare the common size profit and loss statement taking the net sales as 100. What inferences can you draw from the same?

2. Prepare an indexed profit and loss statement taking figures for the year 2015 as the base. Summarize your observations from the same.

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Particulars Net sales Other operating income Interest earned Total Cost of goods sold Employee cost Selling and administrative expenses Depreciation Interest paid Profit before tax Tax Profit after tax 2017 325,192 633 288 326,113 192,766 27,356 49,422 13,295 3,058 40,215 12,065 28,150 (in Thousands) 2016 261,722 681 324 262,727 150,223 26,133 40,817 13,000 3,599 28,955 8,680 20,275 2015 244,055 562 414 245,031 139,220 25,117 41,876 12,211 4,042 22,566 6,770 15,796