Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year year (Decrease) (Decrease) Amount Amount Amount Percent Sales $593,400 $460,000 Cost of merchandise sold 495,300 390,000 % % Gross profit $98,100 $70,000 % Selling expenses $29,750 $25,000 % Administrative expenses 26,670 21,000 % Total operating expenses $56,420 $46,000 % Income before income tax expense $41,680 $24,000 % Income tax expense 16,700 9,600 % Net income $24,980 $14,400 % percentage b. The net income for Winthrop Company increased between years. This increase was the combined result of an sales and in cost of merchandise sold. The cost of merchandise sold increased at a rate than the increase in sales, thus causing the percentage increase in gross profit to be the percentage increase in sales. in than