Question

In constructing a common-size income statement, depreciation will be______. A. omitted since it is a noncash expense. B. expressed as a percentage of sales. C. added back to convert net income to cash flows. D. expressed as a percentage of total assets. E. expressed as a percentage of gross fixed assets.

Answer 1

Answer:

B. expressed as a percentage of sales.

Explanation:

The common size income statement is the income statement where n each line the item on the income statement should be expressed as a percentage of sales

In the given options, the option B is correct as it shows that the depreciation would be expressed in sales percentage

Therefore all other options are wrong