Current Year Previous Year Sales $516,000 $449,000 Cost of merchandise sold 304,440 237,970 Selling expenses 82,560 85,310 Administrative expenses Income tax expense 92,880 15,480 76,330 17,960 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 Sales Cost of merchandise sold Current year Amount Current year Percent $516,000 % 304,440 % % $449,000 % 237,970 % % Selling expenses 82,560 % 85,310 % Administrative expenses 92,880 % 76,330 % % % % % Income tax expense 15,480 % % 17,960 % % b. The vertical analysis indicates that the cost of merchandise sold as a percent of sales by 3 percentage points, and administrative expenses by 3 percentage points. by 6 percentage points, while selling expenses by 1 percentage points. Thus, net income as a percent of sales