Exercise 14-1 (Algo) Common-Size Income Statement [LO14-1) A comparative income statement is given below for McKenzie Sales, Limited, of Toronto: Last Year $ 5,586,000 3,515,500 2,070,500 McKenzie Sales, Limited Comparative Income Statement This Year Sales $ 7,350,000 Cost of goods sold 4,650,000 Gross margin 2,700,000 Selling and administrative expenses : Selling expenses 1,379,000 Administrative expenses 703,000 Total expenses 2,082,000 Net operating income 618,000 Interest expense 104,000 Net income before taxes $ 514,000 1,077,500 610,500 1,688,000 382,500 88,000 $ 294,500 Members of the company's board of directors are surprised to see that net income increased by only $219,500 when sales increased by $1,764,000. Required: 1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) Last Year % This Year % % % % % % Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total selling and administrative expenses Net operating income Interest expense Net income before taxes % % % % % % % % % % % % %