Scherer Company provided the following income statements for its first 3 years of operation:

Scherer Company

Income Statements

Years of Operation

1		Year 1	Year 2	Year 3
2	Net sales	$1,000,000.00	$1,100,000.00	$1,300,000.00
3	Less: Cost of goods sold	(300,000.00)	(310,000.00)	(364,000.00)
4	Gross margin	$700,000.00	$790,000.00	$936,000.00
5	Less:
6	Operating expenses	(421,000.00)	(484,000.00)	(591,500.00)
7	Income taxes	(111,600.00)	(122,400.00)	(137,800.00)
8	Net income	$167,400.00	$183,600.00	$206,700.00

	Required:
	Prepare common-size income statements by using net sales as the base.

Prepare common-size income statements by using net sales as the base. ( Note : Enter all amounts as positive numbers, except for a net loss. Enter net loss as a negative number, if applicable. Round answers to the nearest whole percentage. Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries.)

Answer rating: 100% (QA)

Common size Statements It is the Income statement in which each and ever... View the full answer