Income statements for Campbell Company for Year 3 and Year 4 follow:

CAMPBELL COMPANY Income Statements
	Year 4				Year 3
Sales	$	201,400			$	181,400
Cost of goods sold		143,200				121,200
Selling expenses		22,000				20,000
Administrative expenses		12,100				14,100
Interest expense		4,000				6,000
Total expenses	$	181,300			$	161,300
Income before taxes		20,100				20,100
Income taxes expense		5,500				3,500
Net income	$	14,600			$	16,600

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.

CAMPBELL COMPANY
Horizontal Analysis of Income Statements
	Percentage Change over Year 3
Sales		%
Cost of goods sold
Selling expenses
Administrative expenses
Interest expense
Total expenses
Income before taxes
Income taxes expense
Net income (loss)		%

B.

• CAMPBELL COMPANY
  Vertical Analysis of Income Statements
  	Percentage of Sales Year 4		Percentage of Sales Year 3
  Sales		%		%
  Cost of goods sold
  Selling expenses
  Administrative expenses
  Interest expense
  Total expenses
  Income before taxes
  Income taxes expense
  Net income		%		%