Problem 3: Common-size statements Given the following balance sheet and income statement for Egelloc Products, Inc., restate those financials as common-size financial statements and comment on them. Egelloc Products, Inc. Balance Sheet As of December 31, 2018 (In thousands, except number of shares and par value) Assets Current Assets: Cash 6,336 Accounts receivable 43,000 Inventory 42,000 Other current assets 12,000 Total current assets 103,336 Long-term investments. 25,340 Property, plant & equipment 225,000 Egelloc Products, Inc. Goodwill 30,000 Income Statement Other non-current assets 14,000 Year Ended December 31, 2018 Total assets $ 397,676 (In thousands, except per share amounts) Liabilities and stockholders' equity Revenue Current liabilities: Cost of goods sold Accounts payable $ 57,000 Gross profit Short-term debt 1,500 Operating expenses: Depreciation Other current liabilities 58,500 74,000 15,000 147,500 189,676 60,500 250,176 $ 397,676 Total current liabilities Long-term debt Other non-current liabilities Total liabilities Stockholders' equity: Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Research & development Selling, general & administrative Income from operations Other income EBIT Interest expense Income before income taxes Provision for income taxes Net income $ 950,500 730,000 220,500 50,000 5,200 85,000 80,300 1,350 81,650 3,540 78,110 27,338 $ 50,772