Exercise 14-1 (Algo) Common-Size Income Statement [LO14-1] A comparative income statement is given below for McKenzie Sales, Limited, of Toronto: McKenzie Sales, Limited Comparative Income Statement Book Sales Hint Cost of goods sold Gross margin Print Selling and administrative expenses: rences Selling expenses Total expenses Net operating income Administrative expenses This Year $ 7,390,000 4,720,000 2,670,000 1,376,000 702,500 Last Year $ 5,616,400 3,511,500 2,104,900 1,079,500 613,500 2,078,500 1,693,000 Interest expense Net income before taxes 591,500 102,000 $489,500 411,900 90,000 $ 321,900 Members of the company's board of directors are surprised to see that net income increased by only $167,600 when sales increased by $1,773,600.