Horizontal Analysis of the Income Statement Income statement data for Winthrop Company for two recent years ended December 31, are as follows: Current Year Previous Year $520,900 447,700 $430,000 370,000 Cost of goods sold Gross profit $81.200 Selling expenses $22,600 20.570 $60,000 $20,000 17,000 $37,000 Administrative expenses Total operating expenses $43,170 Income before income tax $38.030 15,200 $22,830 $23,000 9.200 Income tax expenses $13,800 Current year when compared with the previous year. If required, round to one decimal place a. Prepare a comparative Income statement with horizontal analysis, indicating the increase (decrease) Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year Year (Decrease) (Decrease Amount Amount Amount $529,900 $430,000 $ Cost of goods sold 447,700 Grow profit Selling expenses 160.000 $20,000 Administrative expenses 143,170 $37,000 Total Operating expenses Income before income tax $38,030 $21,000 Income tax expense 15,200 200 Net income $22,830 $13,800 b. The net income for Winthrop Company Increased between years. This increase was the combined result of an in sales and The cost of goods sold increased at a rate than the increase in sales, thus causing the percentage increase in gross profit to be percentage in cost of goods so than the percentage increase in sales