a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Previous year Amount Previous year Percent Current year Amount Current year Percent Sales Cost of merchandise sold $523,000 % 308,570 % % $450,000 % 238,500 % % Selling expenses 83,680 % 85,500 % Administrative expenses 94,140 % 76,500 % % % 3 % % Income tax expense 15,690 % 18,000 % % % b. The vertical analysis indicates that the cost of merchandise sold as a percent of sales selling expenses by 3 percentage points, and administrative expenses Thus, net income as a percent of sales by 3 percentage points. by 6 percentage points, while by 1 percentage points.