=+EX 17-26 Unusual items Problems Series A For 2010, Wiglaf Technology Company reported its most significant decline in net income in years. At the end of the year, C. S. Lewis, the president, is presented with the following condensed comparative income statement:

Wiglaf Technology Company Comparative Income Statement For the Years Ended December 31, 2010 and 2009 2010 2009 Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $560,000 $500,000 Sales returns and allowances . . . . . . . . . . . . 37,500 25,000 ________ _________ Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $522,500 $475,000 Cost of goods sold . . . . . . . . . . . . . . . . . . . . 372,000 300,000 ________ _________ Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . $150,500 $175,000 ________ _________ Selling expenses . . . . . . . . . . . . . . . . . . . . . $ 52,000 $ 40,000 Administrative expenses . . . . . . . . . . . . . . . . 30,500 25,000 ________ _________ Total operating expenses . . . . . . . . . . . . . . . $ 82,500 $ 65,000 ________ _________ Income from operations . . . . . . . . . . . . . . . . $ 68,000 $110,000 Other income . . . . . . . . . . . . . . . . . . . . . . . . 3,000 2,000 ________ _________ Income before income tax . . . . . . . . . . . . . . $ 71,000 $112,000 Income tax expense . . . . . . . . . . . . . . . . . . . 5,500 5,000 ________ _________ Net income . . . . . . . . . . . . . . . . . . . . . . . . . $ 65,500 $107,000 ________ ________ _________ _________ Instructions 1. Prepare a comparative income statement with horizontal analysis for the two-year period, using 2009 as the base year. Round to one decimal place.