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
	This Year	Last Year
Sales	$ 7,300,000	$ 5,548,000
Cost of goods sold	4,600,000	3,509,500
Gross margin	2,700,000	2,038,500
Selling and administrative expenses:
Selling expenses	1,397,000	1,079,500
Administrative expenses	702,000	615,000
Total expenses	2,099,000	1,694,500
Net operating income	601,000	344,000
Interest expense	96,000	87,000
Net income before taxes	$ 505,000	$ 257,000

Members of the companys board of directors are surprised to see that net income increased by only $248,000 when sales increased by $1,752,000.

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).)