Why Is the Common-Size Income Statement Valuable to the Analyst

Multiple Choice

Why is the common-size income statement valuable to the analyst?

A) The common-size income statement shows the relative magnitude of revenues and expenses to total assets.
B) The common-size income statement allows the analyst to compare the firm to itself from year-to-year, but not to its competitors.
C) The common-size income statement shows the relative magnitude of revenues and expenses relative to profits.
D) The common-size income statement shows the relative magnitude of expenses relative to net sales.