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case 1: Vertical Analyses of J&J and Pfizer, Inc. Pfizer Inc. is a US company that manufactures and distributes pharmaceutical and consumer healthcare products that

case 1: Vertical Analyses of J&J and Pfizer, Inc. Pfizer Inc. is a US company that manufactures and distributes pharmaceutical and consumer healthcare products that similar to those sold by Johnson & Johnson. Use the excerpts of Johnson & Johnsons and Pfizers income statements to answer the following questions: a) Compute each line item as a percentage of sales for both companies. b) If sales are used as a measure of size, which company is larger? c) Which company has a higher cost of goods sold relative to sales? d) Which company has higher selling, general, and administrative expenses relative to sales? e) Which company has higher research and development expenses relative to sales? f) Which company has a higher income from continuing operations relative to sales? Comment on the difference or lack of difference given other relationships observed. g) Which company has a higher profit margin? Comment on the difference between the two companies.

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