A comparative income statement is given below for McKenzie Sales, Ltd., of Toronto

Members of the companys board of directors are surprised to see that net income increased by only $229,900 when sales increased by $1,754,400.

Required:

1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)

Last Year $5,555,600 3,511,500 2,044,100 Mckenzie Sales, Ltd. Comparative Income Statement This Year Sales $7,310,000 Cost of goods sold 4,610,000 Gross margin 2,700,000 Selling and administrative expenses: Selling expenses 1,390,000 Administrative expenses 707,500 Total expenses 2,097,500 Net operating income 602,500 Interest expense 1 106,000 Net income before taxes $ 496,500 1,078,000 612,500 1,690,500 353,600 87,000 $ 266,600 This Year Last Year % % % % % % % % Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total selling and administrative expenses Net operating income Interest expense Net income before taxes % % % % % % % % % %