Which of the following profitability ratios would be determined through a common size vertical analysis of the income statement?

Question

Quizplus · Accepted Answer

A common size vertical analysis of the income statement shows the percentage of each line item in relation to net sales. Therefore, the gross profit percentage (gross profit divided by net sales, multiplied by 100) can be determined through this analysis. The other options listed cannot be calculated through a common size vertical analysis, as they require information from both the income statement and the balance sheet.

Which of the Following Profitability Ratios Would Be Determined Through