Horizontal analysis of income statement

For 20Y2, Macklin Inc. reported a significant decrease in net income. At the end of the year, John Mayer, the president, is presented with the following condensed comparative income statement:

Macklin Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1

Line Item Description	20Y2	20Y1

Sales	$458,378	$408,000

Cost of goods sold	(327,600)	(260,000)

Gross profit	$130,778	$148,000

Selling expenses	$(45,050)	$(34,000)

Administrative expenses	(27,150)	(22,000)

Total operating expenses	$(72,200)	$(56,000)

Operating income	$58,578	$92,000

Other revenue	2,127	1,700

Income before income tax expense	$60,705	$93,700

Income tax expense	(17,000)	(28,100)

Net income	$43,705	$65,600

Required:

Question Content Area

1. Prepare a comparative income statement with horizontal analysis for the two-year period, using 20Y1 as the base year. Use the minus sign to indicate a decrease in the "Increase/(Decrease)" columns. If required, round percentages to one decimal place.

Macklin Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1