Question

Oil Field Services has net income of $120,400, total assets of $1,219,000, total equity of $694,100, and total sales of $1,521,700. What is the common-size percentage for the net income?

Answer 1

Answer:

7.91%

Explanation:

The computation of the common-size percentage for the net income is shown below:

= (Net income ÷ Total sales) × 100

= ($120,400 ÷ $1,521,700)  × 100

= 7.91%

It shows a relationship between net income and total sales. Since we have to compute the common size percentage i.e means it always be in the denominator

All other information which is given is not relevant. Hence, ignored it