Common-Sized Income Statement Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill's data are expressed in dollars. The electronics industry averages are expressed in percentages. Tannenhill Company Electronics Industry Average Sales 100.0 % $4,000,000 (2,120,000) Cost of goods sold (60.0) Gross profit $1,880,000 Selling expenses $(1,080,000) (640,000) 40.0 % (24.0) % (14.0) Administrative expenses Total operating expenses $(1,720,000) $160,000 (38.0) % 2.0 % Operating income Other revenue and expense: Other revenue 120,000 3.0 Other expense (80,000) (2.0) Income before income tax expense $200,000 3.0 % Income tax expense (80,000) (2.0) Net income $120,000 1.0 % a. Prepare a common-sized income statement comparing the results of operations for Tannenhill Company with the industry average. Tannenhill Company Common-Sized Income Statement For the Year Ended December 31 Tannenhill Tannenhill Electronics Company Company Industry Amount Percent Average $4,000,000 % 100% Sales Cost of goods sold (2,120,000) (60) Gross profit $1,880,000 40% Selling expenses $(1,080,000) (24)% Administrative expenses (640,000) (14) Total operating expenses $(1,720,000) $160,000 % % (38)% 2% Operating income Other revenue and expense: Other revenue 120,000 Other expense (80,000) Income before income tax expense $200,000 Income tax expense (80,000) Net income $120,000 than the industry, and has slightly selling and administrative expenses relative to the industry. The combined impact causes net income as a b. The company is managing the cost of manufacturing product percent of sales to be than the industry average