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P3-19 Common-size statement analysis A common-size income statement for Creek Enterprises' 2018 operations follows. Using the firm's 2019 income statement presented in Problem 3-16, develop
P3-19 Common-size statement analysis A common-size income statement for Creek Enterprises' 2018 operations follows. Using the firm's 2019 income statement presented in Problem 3-16, develop the 2019 common-size income statement and compare it with the 2018 statement. Which areas require further analysis and investigation? P3-20 The relationship between financial leverage and profitability Pelican Paper lne, and Timberland Forest Inc, are rivals in the manufacture of craft papers. Some financial statemene values for cach company follow. Use them in a ratio analysis that compares the firms' financial leverage and profitability. a. Calculate the following debt and coverage ratios for the two companies. Discus their financial risk and ability to cover the costs in relation to each other. 1. Dobr ratio- 2. Times interest earned ratio
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