Exercise 4-19A Using common size statements and ratios to make comparisons LO 4-8 00 The following information is available for the Memphis and Billings companies: 3.65/5 points awarded Sales Cost of goods sold Operating expenses Total assets Stockholders' equity Memphis $1,281,16 831,080 362,040 1,150,000 310,000 Billings $1,277,280 907, e80 319, 100 1,240,000 350,000 Scored 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? Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Prepare a common size income statement for each company. (Round percentage answers to 1 decimal place.) MEMPHIS COMPANY AND BILLINGS COMPANY Common Size Income Statements Memphis % Billings % Sales 100.0 1.281,160 100.0 1,277,280 Cost of goods sold 831,080 66.0 X 907,080 74.0 X Gross margin 450,080 34.0 370,200 26.0 Operating expenses 362,040 25.8 X 319,100 22.4 Net income $ 88,040 8.2 $ 51,100 3.6