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 Sales $901,700 $710,000 Cost of goods sold 775,000 620,000 Gross profit $126,700 $90,000 Selling expenses $37,440 $32,000 Administrative expenses 33,750 27,000 Total operating expenses $71,190 $59,000 Income before income tax $55,510 $31,000 Income tax expenses 22,200 12,400 Net Income $33,310 $18,600 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. Winthrop Company Comparative Income Statement For the Years Ended December 31 Current Previous Increase Increase year year (Decrease) (Decrease) Amount Amount Amount Percent Sales $901,700 $710,000 96 Cost of goods sold 775,000 620,000 96 Gross profit $126,700 $ $90,000 % Selling expenses $37,440 $32,000 % Administrative expenses 33,750 % Total operating expenses $71,190 $59,000 96 Income before income tax $55,510 $31,000 % Income tax expense 22,200 12,400 96 Net Income $33,310 $18,600 96 27,000 Feedback