A firm has sales of $1,500,net income of $100,total assets of $1,000,and total equity of $700. Interest expense is $50. What is the common-size statement value of the interest expense?
A) 3.3%
B) 5.0%
C) 7.1%
D) 16.7%
E) 50.0%

Question

Quizplus · Accepted Answer

The common-size statement value of the interest expense is calculated as (Interest Expense / Sales) * 100 = ($50 / $1,500) * 100 = 3.3%.

A Firm Has Sales of $1,500,net Income of $100,total Assets