Use the income statement information to prepare a common-size income statement for all three years. Use the information to identify accounts for which you believe there is a concern about material misstatements.

B C D E F H 1 J L L M N o P. O R S U 2011 2010 2009 Dollar Value Dollar Value Dollar Value 150,918,731 148,764,555 144,860,245 181,103 178,518 173,832 109,284,780 106,255,499 101.988,165 41,452,848 42,330,538 42,698,248 f* A 1 Pinnacle Manufacturing Company 2 Income Statement - All Divisions 3 For the Year Ended December 31 4 5 6 7 Sales 8 Sales Returns and Allowances 9 Cost of Sales 10 Gross Profit 11 OPERATING EXPENSES-Allocated 12 Salaries-Management 13 Salaries-Office 14 Licensing and certification fees 15 Security 16 Insurance 17 Medical benefits 18 Advertising 19 Business publications 20 Property taxes 21 Bad debts 22 Depreciation expense 2,281,266 315,169 190,650 550,603 93,197 23,721 162,512 6,989 22,585 841,699 5,336,783 2,387,993 296,681 172,883 637,580 103,842 29,453 178,009 5,555 178,000 2,295,081 306,856 162,279 630,353 108,491 28,810 165,678 774 1,034,060 4,641,982 175,692 992,094 4,367,565 273,956 10,099,130 297777 9,963,824 299 789 9,533,462 14,970,669 491,794 1,113,539 4,891,065 27,649 23 Accounting fees 24 Total operating expenses-Allocated 25 OPERATING EXPENSES-Direct 26 Salaries-Sales 27 Wages Rental 28 Wages-Mechanics 29 Wages-Warehouse 30 Garbage collection 31 Payroll benefits 32 Rent- Warehouse 33 Telephone 34 Utilities 35 Postage 36 Linen service 37 Repairs and maintenance 38 Cleaning service 39 Legal service 40 Fuel 41 Travel and entertainment 42 43 Office supplies 2,657,889 802,855 32,402 262,393 89,763 17,282 166,985 89,800 396,016 286,547 103,389 228,555 149,828 15,327,777 595,389 1,339,626 5,340,271 29,771 2,937,730 764,346 45,173 267,005 133,518 12,350 168,405 81,589 190,540 341,192 103,842 237,350 148,340 14,904,392 575,725 1,333,411 5,473,249 37,969 2,894,300 758,345 57,867 274,365 151,278 16,083 178,213 78,088 152,238 279,512 100,479 127,011 171,109 Pension expense 44 Miscellaneous 45 Total operating expenses-Direct 46 Total Operating Expenses 47 Operating Income 48 Other Expense-Interest 49 Income Before Taxes 50 Federal Income Taxes 51 Net Income * Details of manufacturing expenses are 52 not included in this schedule, 300,188 27,078,608 37,177,738 4,275,110 2,181,948 2,093,162 883,437 105.931 28.170.145 38,133,969 4,196,569 2.299 217 1,897,352 858.941 1,038,411 144.012 27,707,646 37,241,108 5,457,140 2.397953 3,059,187 1 341 536 1,717,651 1,209,725