13 CHAPTER 3 Financial Statements and Ratio Analysis 9 Common-size statement analysis A common-size income statement for Creek Enterprises' 2018 operations follows. Using the firm's 2019 income statement presented in Problem 3-16, develop the 2019 common-size income statement an compare it with the 2018 statement. Which areas require further analysis and investigation? Creek Enterprises Common-Size Income Statement for the Year Ended December 31, 2018 100.0% 65.9 34.1% 12.7% 6.3 0.6 3.6 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 23.2% 10.9% 1.5 9.4% 2.0 7.4% 0.1 7.3% atements (following), evaluate and recommend appropriate ac t. Creek Enterprises Income Statement for the Year Ended December 31, 2019 $30,000,000 21,000,000 $ 9,000,000 Sales revenue 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 $ 3,000,000 1,800,000 200,000 1,000,000 $ 6,000,000 $ 3,000,000 1,000,000 $ 2,000,000 420,000 $ 1,580,000 100,000 $ 1,480,000