Common-size statement analysis A common-size income statement for Creek Enterprises 2018 operations follows Using the firm's 2019 income statement develop the 2019 common-size income statement and compare it to the 2018statement. Which areas require further analysis and investigation? Complete the common-site income statement for the year ending December 31, 2019 and compare it to the common-size income statement for the year ending December 2018: (Round to one decimal place.) Creek Enterprises Common-Size Income Statement for the Years Ended December 31, 2018 and December 2019 2019 2018 % 100.0 % 65.5 34.5 % Sales revenue Loss: Cost of goods sold Gross profits Less: Operating expenses Selling expense General and administrative expenses Lease expense Depreciation expenso Total operating expenso % 12.2% 6.4 0.4 3.6 226 Enter any number in the edit fields and then continue to the next question 40 Common-size statement analysis A common-size income statement for Creek Enterprises 2018 operations follows Using the firm's 2019 income statement develop the 2019 common-size income statement and compare it to the 2018statement. Which areas require further analysis and investigation? Operating profits 11.9% Less: Interest expense 2.0 Net profits before taxes 9.9% Less: Taxes (rate = 40%) Net profits after taxes 5.9% Less: Preferred stock dividends 0.2 Eatings available for common stockholders 5.7% Provide your evaluation based on the common-size income statements: (Select all the choices that apply) A. Sales have declined and cost of goods sold has increased as a percentage of sales, probably due to a loss of productive efficiency B. Selling expense has increased due to the increase in cost of goods sold C. Operating expenses have decreased as a percentage of sales; this appears favorable unless this decline has contributed toward the fall in D. The level of interest as a percentage of sales has increased significantly, this suggests that the firm has too much debt. E. Further analysis should be directed at the increased cost of goods sold and the high debt level % Se sje sales Enter any number in the edit fields and then continue to the next question (Click the icon here spreadsheet.) in order to copy the contents of the data table below into a nse axes = 400 100.0 % 65.5 34.5 % kes ock d for a Jation Creek Enterprises Income Statement for the Year Ended December 31, 2018 Sales revenue ($34,966,000) Less: Cost of goods sold Gross profits Less: Operating expenses Selling expense 12.2 % General and administrative expenses 6.4 Lease expense 0.4 Depreciation expense 3.6 Total operating expense Operating profits Less: Interest expense Net profits before taxes Less: Taxes (rate=40%) Net profits after taxes Less: Preferred stock dividends Earnings available for common stockholders deci fficiency pense exper 22.6 11.9 % 2.0 9.9 % 4.0 5.9 % 0.2 5.7 % toward the of inte nalysis Print Done er in th| e Turir on? ts expen ore ta ate=4 rtaxel stoc able fd (Click the icon here in order to copy the contents of the data table below into a spreadsheet.) Creek Enterprises Income Statement for the Year Ended December 31, 2019 Sales revenue $30,004,000 Less: Cost of goods sold 20,976,000 Gross profits $9,028,000 Less: Operating expenses Selling expense $3,002,000 General and administrative expenses 1,799,000 Lease expense 192,000 Depreciation expense 952,000 Total operating expense 5,945,000 Operating profits $3,083,000 Less: Interest expense 1,020,000 Net profits before taxes $2,063,000 Less: Taxes (rate = 40%) 825,200 Net profits after taxes $1,237,800 Less: Preferred stock dividends 128,000 Earnings available for common stockholders $1,109,800 aluat aved exper fiency ng ex ard the el of i analy Print Done ber in