Exercise 14.3 (Algo) Common Size Income Statements (LO14-1) Sales Cost of goods sold Gross profit Operating expenses Net income Year 2 $ 507,000 330,000 $ 177,000 130,000 Year 1 $ 424,000 268,000 $ 156,000 116,000 $ 47,000 $ 40,000 a. Prepare common size income statements for Price Company, a sole proprietorship, for the two years shown as above by converting the dollar amounts into percentages. For each year, sales will appear as 100 percent and other items will be expressed as a percentage of sales. (Income taxes are not involved as the business is not incorporated.) b. State whether the changes from year 1 to year 2 are favorable or unfavorable. Complete this question by entering your answers in the tabs below. Required A Required B Prepare common size income statements for Price Company, a sole proprietorship, for the two years sh converting the dollar amounts into percentages. For each year, sales will appear as 100 percent and oth expressed as a percentage of sales. (Income taxes are not involved as the business is not incorporated percentage value answers to 2 decimal places. i.e. 0.1234 as 12.34%.) Sales Cost of goods sold Gross profit Operating expenses Net income Year 2 Year 1 % % % % % % % % % % < Required A Required B >