Table 2. Solace Espresso Co.: Vertical (Common-Size) Income Statement<\/p>\n
Annual Period 2024 2025 Change Revenue 100.0% 100.0% 0.0% Cost of Goods Sold (COGS) 62.0% 62.5% +0.5% Gross Profit 38.0% 37.5% \u22120.5% Selling, General & Administrative (SG&A) 30.0% 33.8% +3.8% Operating Income 8.0% 3.7% \u22124.3% Interest Expense 0.8% 1.2% +0.4% Earnings Before Tax (EBT) 7.2% 2.5% \u22124.7% Income Tax Expense 1.5% 0.6% \u22120.9% Net Income 5.7% 1.9% \u22123.8%<\/p>\n
Solace\u2019s executive team is concerned about the decline in operating income as a percentage of revenue between 2024 and 2025. Based on Table 2 above, which change appears to be the primary driver of this decline?
\n<\/p>\n","protected":false},"excerpt":{"rendered":"
Table 2. Solace Espresso Co.: Vertical (Common-Size) Income Statement Annual Period 2024 2025 Change Revenue 100.0% 100.0% 0.0% Cost of Goods Sold (COGS) 62.0% 62.5% +0.5% Gross Profit 38.0% 37.5% \u22120.5% Selling, General & Administrative (SG&A) 30.0% 33.8% +3.8% Operating Income 8.0% 3.7% \u22124.3% Interest Expense 0.8% 1.2% +0.4% Earnings Before Tax (EBT) 7.2% 2.5%<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1675","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"Verity Staging","author_link":"https:\/\/free-exam-answers.com\/?author=6"},"_links":{"self":[{"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=\/wp\/v2\/posts\/1675","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1675"}],"version-history":[{"count":0,"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=\/wp\/v2\/posts\/1675\/revisions"}],"wp:attachment":[{"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1675"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1675"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/free-exam-answers.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1675"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}