Analyzing Income Statements for Two Merchandising Companies Shown below are the income statements for two different companies in the ture business INCOME STATEMENTS YEAR ENDED DECEMBER 31.20 Company A Company! $121 206 70 704 $415072 211 666 $2033 $ 50 502 Revenue Sales Cost of Goods Sold Gross Profit Operating Expenses Advertising Expense Bank Charges Expense Building Maintenance Expense Delivery Expense Depreciation Expense Insurance Expense Licences Expense Utilities Expense Miscellaneous Expense Rent Expense Telephone Expense Wages Expense Total Operating Expenses Net Income 990 140 6 301 4 102 509 120 1 850 119 4 800 275 10 402 $ 29 608 $ 43072 5766 3500 22.685 1252 1532 435 5 775 711 12.00 TH 4000 $149015 $ 20 894 $ 543 file or low profile, etc.) giving specific reasons for your impression Questions 1. Describe your mental picture of these two companies (large or small hich 2. Company B's expenses are much larger than Company As, yet Company B to earn more than twice the net income of Company A How is this post 3. The relationship between the cost price of the goods and the selling price of goods is crucial in any business. Consider the following analysis for Company $121 206 - 100% $ 70 704 58% Sales Cost of Goods Sold Company A's goods cost 58 per cent of their selling price. a. Calculate this same percentage figure for Company B. b. If the figure for Company B were 18 per cent, the same as for Com how much lower would Company B's net income be