Current Year Previous Year Sales $388,000 $341,000 Cost of merchandise sold 225,040 180,730 Selling expenses 65,960 64,790 Administrative expenses Income tax expense 69,840 11,640 57,970 13,640 a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Sales Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Current year Amount Current year Percent $388,000 % Previous year Amount Previous year Percent $341,000 % Cost of merchandise sold: 225,040 Selling expenses 65,960 * * * 180,730 % 0 % % 64,790 % Administrative expenses 69,840 % 57,970 % % % % Income tax expense 11,640 % 13,640 % a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Previous year Amount Previous year Percent Current year Amount Current year Percent Sales $388,000 $341,000 % Cost of merchandise sold 225,040 180,730 % % % Selling expenses 65,960 % 64,790 % Administrative expenses 69,840. % 57,970 % % % % Income tax expense 11,640 % 13,640 % % % b. The vertical analysis indicates that the cost of merchandise sold as a percent of salesi expenses by 2 percentage points, and administrative expenses) by 5 percentage points, while selling by 1 percentage points. Thus, net income as a percent of sales: by 3 percentage points.