Previous Year $330,000 280,000 Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Income before income tax Income tax expenses Current Year $419,100 350,000 $69,100 $19,890 18,750 $38,640 $30,460 12,200 $18,260 $50,000 $17,000 15,000 $32,000 $18,000 7,200 Net income $10,800 a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decre 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 $419,100 $330,000 $ Cost of goods sold 350,000 280,000 Gross profit $69,100 $50,000 Selling expenses $19,890 $17,000 Administrative expenses 18,750 15,000 Total operating expenses $38,640 $32,000 Income before income tax $30,460 12,200 $18,000 $ 7,200 Income tax expense Net income $18,260 $10,800 Cost of goods sold 350,000 280,000 $50,000 Gross profit $69,100 Selling expenses $17.000 $19,890 18,750 Administrative expenses 15,000 Total operating expenses Income before income tax Income tax expense $30,460 12,200 $18,260 $18,000 $ 7,200 $10,800 $ Net income b. The net income for Winthrop Company increased between years. This increase was the combined result of an in sales and percentage 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 than the percentage increase in sales