Orlando Medical’s common-size income statement for 2018 would report cost of goods sold as

a. 82.4%.

b. $35,147 million.

c. up by 20.1%.

d. 137.9%.

Use the Orlando Medical Corporation financial statements that follow to answer this question.

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A1 Orlando Medical Corporation Consolidated Statements of Financial Position December 31, 2018 2 3 (In Millions) 4 Assets: 2017 Current Assets Cash and cash equivalents Short-term investments Accounts and notes receivable Inventories, at cost $ 4,333 845 3,400 433 $ 4,226 520 2,403 411 8 Prepaid expense and other current assets 10 11 1,638 10,649 1,555 6,804 303 $ 19,311 1,226 8,786 907 Total current assets 12 Property and equipment, net 13 Investments 5,199 155 $ 15,047 14 Other non-current assets 15 Total assets 16 Liabilities and stockholders' equity: Current liabilities Accounts payable Accrued and other liabilities Total current liabilities 17 18 19 $ 7,708 3,676 11,384 304 1,701 13,389 $ 6,009 3,033 9,042 305 1,179 10,526 20 21 Long-term debt Other non-current liabilities 22 23 Total liabilities 24 Stockholders' equity Preferred stock and capital in excess of $0.02 par value; 25 shares issued and outstanding: none Common stock and capital in excess of $0.05 par value; shares authorized: 6,000; shares issued: 2,163 and 1,903, respectively Treasury stock, at cost: 183 and 123 shares, respectively 26 27 28 29 7,803 (6,444) 4,676 (79) (34) 5,922 $ 19,311 7,001 (4,401) 1,990 (25) (44) 4,521 $ 15,047 30 Retained earnings 31 Other comprehensive loss 32 Other 34 Total stockholders' equity 35 Total liabilities and stockholders' equity 33 36 A1 Orlando Medical Corporation Consolidated Statements of Income Year ended December 31, 2018 3 (In Millions, Except per Share Amounts) 4 Net Revenue 5 Cost of goods sold Gross profit 7 Operating expenses: Selling, general, and administrative Research, development, and engineering 10 2017 2016 $ 42,666 35,147 7,519 $ 35,220 29,255 5,965 $ 31,111 25,492 5,619 6 3,341 544 3,250 553 2,985 536 Special charges 512 4,033 1,586 (30) 1,556 472 $ 1,084 11 Total operating expenses 3,885 3,634 153 3,803 2,162 196 12 Operating income 13 Investment and other income (loss), net 14 Income before income taxes 15 Income tax expense 16 3,787 1,136 $ 2,651 2,358 940 $ 1,418 Net income 17 Earnings per common share: 18 Basic 19 1.41 0.95 0.37