Exercise 4-19A (Algo) Using common size statements and ratios to make comparisons LO 4-8The following information is available for the Memphis and Billings companies:Memphis$ 1,212,000800,000336,0001,440,000380,000SalesCost of goods soldOperating expensesTotal assetsStockholders' equityRequired:a. Prepare a common size income statement for each company.b. Compute the return on assets and return on equity for each company.c. Which company is more profitable from the stockholders' perspective?d. One company is a high-end retailer, and the other operates a discount store. Which is the discounter?Complete this question by entering your answers in the tabs below.Billings$ 1,150,640878,000229,3201,330,000380,000Required A Required B Required C Required DPrepare a common size income statement for each company.Note: Round percentage answers to 1 decimal place.MEMPHIS COMPANY AND BILLINGS COMPANYCommon Size Income StatementsMemphis%$000.0Billings0.0 $Required A00%< Prev0.00.0Required B7 of 7HHHNextW c. Which company is more profitable from the stockholders' perspective?d. One company is a high-end retailer, and the other operates a discount store. Which isComplete this question by entering your answers in the tabs below.Required A Required B Required C Required DCompute the return on assets and return on equity for each company.Note: Round your answers to 1 decimal place.Return on assetsReturn on equityMemphisCompany%%BillingsCompany%%< Required ARequired C< Prev**********7 of 7‒‒‒

Common Size Statement - Total Sales will be considered as 100% and other Income Statement items will…

Exercise 4-19A (Algo) Using common size statements and ratios to make comparisons LO 4-8 The following information is available for the Memphis and Billings companies: Sales Cost of goods sold Operating expenses Total assets Stockholders' equity Memphis Billings $ 1,212,000 $ 1,150,640 800,000 878,000 336,000 229,320 1,440,000 380,000 1,330,000 380,000 Required: a. Prepare a common size income statement for each company. b. Compute the return on assets and return on equity for each company. c. Which company is more profitable from the stockholders' perspective? d. One company is a high-end retailer, and the other operates a discount store. Which is the discounter?