According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of computer equipment fell 8.1 percent between 2012 and 2013.

Required: 1. Conduct a horizontal analysis by calculating the year-over-year changes in each line item, expressed in dollars and in percentages for the income statement of Computer Tycoon Inc. for the year ended December 31 2013. (Decreases should be indicated by a minus sign. Round percentage values to 1 decimal place.) COMPUTER TYCOON, INC. Income Statements For the Year Ended December 31 Change in 2013 2012 Dollars Percentage Sales Revenue 120,000 150,000 Cost of Goods Sold 70,000 79,500 Gross Profit 50,000 70,500 Selling, General, and 38,000 41,000 Administrative Expenses Interest Expense 700 575 Income before Income Tax 11,300 28,925 Expense Income Tax Expense 2,500 7,000 S Net Income 8,800 21,925 2- Conduct a vertical analysis by expressing each line as a percentage of a. total revenues. (Round percentage values to 1 decimal place.) COMPUTER TYCOON, INC. Income Statements For the Year Ended December 31 2013 2012 50,000 Sales Revenue 120,000 70,000 79,500 Cost of Goods Sold 50,000 70,500 Gross Profit Selling, General, and 38,000 Administrative Expenses 700 575 Interest Expense 11.300 Income before Income Tax 28,925 Expense 2500 7,000 Income Tax Expense 8,800 Net Income 21.925