2 J.C. Penney Company, Inc. Common Size Income Statement 3 Total net sales 4 Credit income and other 5 Total revenues 6 Costs and expenses/(income): Cost of goods sold (exclusive of depreciation and amortization shown separately below) 8 Selling, general and administrative (SG&A) 9 Depreciation and amortization 10 Real estate and other, net 11 Restructuring and management transition 12 Total costs and expenses 13 Operating income/loss) 14 Other components of net periodic pension and postretirement benefit cost/income) 15 Loss on extinguishment of debt 16 Net interest expense 17 Income/(loss) before income taxes 18 Income tax expense/(benefit) 19 Net income/loss) 20 Percentages Feb. 03, 2018 Feb. 02, 2019 Jan. 28, 2017 BE D 12 Months Ended in Millions $ Feb. 02, 2019 Feb. 03, 2018 Jan. 28, 2017 $ 11,664 $ 12.554 $ 12,571 355 319 347 12,019 12,873 12,918 7,870 3,596 556 (19) 8,097 3,973 609 (111) 26 12,594 324 (53) 22 8,208 3,845 570 (146) 184 12.661 212 98 33 325 (244) (126) $ (118) 12,025 (6) (71) 23 313 (271) (16) $ (255) (17) a Review the income statement vertical analyses percentage and provide at least two major changes over the three years. Are these changes a positive or negative trend? You b. What are the company's 2 largest major expenses for the current year? c. Discuss the fluctuations in net interest expense and income taxes. What are the cause of these changes in each of the accounts? You need to be specific to what is occurring in