Income statements for Zachary Company for Year 3 and Year 4 follow: ZACHARY COMPANY Income Statements Year 4 Sales $ 201,100 Cost of goods sold 144,000 Selling expenses 21,800 Administrative expenses 12,200 Interest expense 3,600 Total expenses $181,600 Income before taxes 19,500 Income taxes expense 6,700 Net income $ 12,800 Year 3 $181,100 122,000 19,800 14,200 5,600 $161,600 19,500 3,600 $ 15,900 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. Required A Required B Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. (Negative answers should be indicated by a minus sign. Round your percentage answers to 1 decimal place. (i.e., 0.234 should be entered as 23.4).) ZACHARY 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) % Required A Required B Required A Required B Perform a vertical analysis, showing each income statement component as a percentage of sales for each year. (Percentages may not add exactly due to rounding. Round your percentage answers to 1 decimal place. (i.e., 0.234 should be entered as 23.4).) ZACHARY COMPANY Vertical Analysis of Income Statements Percentage of Percentage of Sales Year 4 Sales Year 3 % % Sales Cost of goods sold Selling expenses Administrative expenses Interest expense Total expenses Income before taxes Income taxes expense Net income % %