Income statements for Adams Company for Year 3 and Year 4 follow: follow numbers for years as 4th year first and 3rd year second.

ADAMS COMPANY Income Statements Year 4 Year 3 Sales $ 200,100 and $ 180,100

Cost of goods sold 143,900 and 121,900

Selling expenses 22,000 and 20,000

Administrative expenses 12,300 and 14,300

interest expense 3,000 and 5,000

Total expenses $ 181,200 and $ 161,200

Income before taxes 18,900 and 18,900

Income taxes expense 5,300 and 3,000

Net Income $13600 and $15900

Required a. Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. b. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.