Southwest Airlines Co. (LUV) provides passenger services throughout the United States, Mexico, Jamaica, the Bahamas, Aruba, and the Dominican Republic. The following operating data (in millions) were adapted from recent financial statements of Southwest.

1. Prepare common-sized income statements for Years 1 and 2. Round to one decimal place.

2. Using your answer to (1), analyze and comment on the performance of Southwest in Year 2.

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Year 1 Year 2 Revenue.. $ 20,425 $ 21,171 Operating expenses: Fuel .. Aircraft related ... Selling and general..... Other expenses ..... Total operating expenses..... Operating income $ (3,647) (3,706) (6,798) (2,514) $(16,665) $ 3,760 $ (3,940) (3,709) (7,319) (2,688) $(17,656) $ 3,515