(Solution) - Interpreting common size income statements Ericsson a Swedish e -(2025 Original AI-Free Solution)

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Interpreting common-size income statements Ericsson, a Swedish electronics and telecommunications firm, has seen increasing sales in recent years. At the same time, its profit margin has declined. Exhibit 4.9 presents common-size income statements for Ericsson for three recent years, based on Ericsson?s financial reports for fiscal 2007. Ericsson applies IFRS and reports in millions of Swedish kroner (SEK). Discuss the likely reasons for the decreasing profit margin for Ericsson over the three-yearperiod.