b. Comment the significant changes have occurred and what suggest the changes. 4. Using the same data of the problem number 5, prepare a schedule showing a vertical analysis for the year 2010 Accounts Titles ----------------------------------------------------- 3. The following data are from a company Income Statement. Comparative Income Statement For the Years Ended December 31, 2010 and 2009 2010 2009 Sales ....... Sales returns and allowances ... Net sales Cost of goods sold ........... Gross profit .............. Selling expenses ......... Administrative expenses Total operating expenses Income from operations Other income ..... $1,530,500 32,500 $1,498,000 1,043,000 $ 455,000 $ 191,000 104,000 $ 295,000 $ 160,000 8,500 $ 168,500 6,000 $ 162,500 71,500 $ 91,000 $1,234,000 34,000 $1,200,000 820,000 $ 380,000 $ 147,000 97,400 $ 244,400 $ 135,600 11,000 $ 146,600 12,000 $ 134,600 58,100 $ 76,500 Other expense (interest) ......... Income before income tax ............ Income tax expense ................ Net income .............. a. Compute the amount and percentage changes in 2010 using horizontal analysis, assuming 2009 is the base year. Accounts Titles Amount Percentage