develop the 2019 common-size income statement and compare it to the 2018statement. Which areas require further analysis and for the Years Ended December 31, 2018 and December 2019 2019 2018 1000 % 100.0 % 700 66.1 30,0 33.9% 9.9% 13.0 % 5.9 6.2 Sales revenue Less Cost of goods sold Gross profits Less Operating expenses Selling expense General and administrative expenses Lease expense Depreciation expense Total operating expense Operating profits Less: Interest expense Net profits before taxes Less Taxes (rate = 40%) Pinc31 Net profits after taxes 0.7 0.5 3.3 3.6 19 8 23.3 10.2 % 10.6 % 3.5 1.2 6.7 % 27 9.4 % 3.8 40 % 5.6 % 300 % 33 9 % 9.9% 13.0 % 5.9 6.2 0.7 05 3.3 3.6 Gross profits Loss Operating expenses Selling expense General and administrative expenses Lease expense Depreciation expense Total operating expense hon Operating profits Less: Interest expense Net profits before taxes Less: Taxes (rate = 40%) Net profits after taxes Less: Preferred stock dividends on 19 8 23.3 10 2 % 10.6 % 3.5 1.2 6.7 % 2.7 40 % 9.40 3.8 5.6 % 0.2 5.4 % 0.4 37 % Earnings available for common stockholders Provide your evaluation based on the common-size income statements: (Select all the choices that apply) Se (Pinc31 Click to select your answer(s) and then click Check Answer All parts showing 33 3.6 198 23.3 102 % 10.6 % 35 1.2 Depreciation expense ed Total operating expense co Operating profits Less Interest expense Net profits before taxes Less Taxes (rate=40%) Net profits after taxes Less. Preferred stock dividends stion Earings available for common stockholders 6.7 % 9.4 % 38 2.7 stion 40% 5.6% 0.2 0.4 3.7 % 5.4 % Provide your evaluation based on the common-size income statements: (Select all the choices that apply) A. The level of interest as a percentage of sales has increased significantly, this suggests that the firm has too much debt B. Operating expenses have decreased as a percentage of sales, this appears favorable unless this decline has contributed toward the fall in sales. DC. Sales have declined and cost of goods sold has increased as a percentage of sales, probably due to a loss of productive efficiency D. Selling expense has increased due to the increase in cost of goods sold E. Further analysis should be directed at the increased cost of goods sold and the high debt level. urse (Pinc