Horizontal Analysis of the Income Statement Income statement data for Boone Company for two recent years ended December 31, are as follows: Current Year Previous Year Sales $942,400 $760,000 Cost of goods sold 780,800 640,000 Gross profit $161,600 $120,000 Selling expenses $45,600 $40,000 Administrative expenses 41,480 34,000 Total operating expenses $87,080 $74,000 Income before income tax $74,520 $46,000 Income tax expenses 29,800 Net income $44,720 18,400 $27,600 a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round to one decimal place. Boone Company Comparative Income Statement For the Years Ended December 31 Current year Amount Previous year Amount Increase (Decrease) Amount Increase (Decrease) Percent Sales $942,400 $760,000 Cost of goods sold 780,800 640,000 Gross profit $161,600 $120,000 Selling expenses 45,600 40,000 Administrative expenses 41,480 34,000 Total operating expenses $87,080 $74,000 Income before income tax $74,520 $46,000 Income tax expense 29,800 Net income $44,720 18,400 $27,600 % % % % % % % % % percentage b. The net income for Boone Company increased by 62% between years. This increase was the combined result of an in sales of 24% and in cost of goods sold. The cost of goods sold increased at a rate than the increase in sales, thus causing the percentage increase in gross profit to be the percentage increase in sales. than