Horizontal Analysis of the Income Statement Income statement data for Weithrop Company for two recent years ended December 31 are as follows: Current Year Previous Year Sales Cost of goods sold $2,240,000 $2,000,000 (1,925,000) (1,750,000) Gross profit $315,000 Seling expenses $(152,500) $250,000 $(125,000) Administrative expenses (110,000) Total operating expenses $(270,500) (100,000) $(225,000) Income before income tax expense Income tax expense $44,500 $25,000 Net income (17,000) $26,700 (10,000) $15,000. a. Prepant a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year required, round to one decimal place Winthrop Company Comparative Income Statement For the Years Ended December 311 Current Previous Increase Increase year Amount year Amount (Decrease) Amount (Decrease) Percent Sales $2,240,000 $2,000,000 a. Prepare a comparative income statement with honzontal analysis, indicating the increase (decrease) for the current year whes compared with the previous year. If required, round to one decimal place. Sales Cost of goods sold Gross profit Selling expenses Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year Amount year Amount (Decrease) Amount (Decrease) Percent $2,240,000 $2,000,000 (1.925,000) (1,750,000) $315,000 $250,000 $(152,500) 5(125,000) Administrative expenses (110,000) (100,000) Total operating expenses $(270,500) $(225,000) Income before income tax expense $44,500 $25,000 Income tax expense (17,000) (10,000) Net income $26,700 $15,000 in sales and a percentage sate than the increase in sales, thus causing the percentage increase in gross b. The net income for Winthrop Company increased between years. This increase was the combined result of an in cost of goods sold. The cost of goods sold increased at al profit to be than the percentage increase in sales