a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round to one decimal place. Sales Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year year (Decrease) (Decrease) Amount Amount Amount Percent $712,000 $540,000 Cost of merchandise sold 580,500 450,000 Gross profit $132,300 $90,000 $40,260 $33,000 Selling expenses Administrative expenses Total operating expenses Income before income tax expense 36,400 28,000 $76,660 $61,000- $55,040 $29,000 Income tax expense Net Income 22,300 11,600 $33,340 $17,400) b. The net income for Winthrop Company increased between years. This increase was the combined result of an percentage in cost of merchandise sold. The cost of merchandise sold increased at al percentage increase in gross profit to be than the percentage increase in sales. in sales and rate than the increase in sales, thus causing the Honzontal Analysis of the Income Statement Income statement data for Winthrop Company for two recent years ended December 31 are as follows: Current Year Previous Year Sales Cost of merchandise sold Gross profit $712,800 $540,000 580,500 450,000 $132,300 $90,000 Selling expenses $40,260 $33,000 Administrative expenses 36,400 28,000 Total operating expenses $76,660 $61,000 Income before income tax expense $55,640 $29,000 Income tax expenses Net income 22,3001 $33,340 11,600 $17,400 a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round to one decimal place.