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Pittsburgh Motors has sales of $4,300, net income of $320, total assets of $4,800, and total equity of $2,950. Interest expense is $65. What is the common-size statement value of the interest expense?

Respuesta :

Answer:

1.51%

Explanation:

The computation of the common-size statement value of the interest expense is shown below:

Common size interest = Interest expense ÷ Sales × 100

where,

Interest expense is $65

And, the sales is $4,300

Now putting these values to the above formula

So, the value of the interest expense is

= $65 ÷ $4,300 × 100

= 1.51%

Hence, the common-size statement value of the interest expense is 1.51%

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