QUESTION 1) (35 pts) ABC company's Income Statements for 2016-2020 are given below: Sales Revenue COGS (-) Gross Profit Operating Expenses (-) General Admin Expenses (-) Marketing and Sales Expenses (-) Operating Profit Interest Expense (-) Gain on Sale of an unused building Profit Before Tax Tax Expense (-) Net Profit 2020 2019 2018 2017 2016 $36,000 $24,000 $22,500 $15,000 $10,500 $ 19,800 12,000 9,000 8,250 7,350 16,200 12,000 13,500 6,750 3,150 8,280 4,560 5,175 4,500 2,205 5,400 3,120 3,375 2,700 1,575 2,880 1,440 1,800 1,800 630 7,920 7,440 8,325 2,250 945 1,200 1,050 1,500 1,500 1,500 2,400 0 900 0 1,200 9,120 6.390 7.725 750 645 730 511 618 60 52 8,390 5,879 Z.107 690 593 a) Show the index-trend percentages for each item for five years taking 2016 as the base year. (Show supportive calculations) (15 pts) b) Indicate whether the trend for COGS and Marketing and Sales Expenses are Favorable or Unfavorable? (5 pts) c) Write your conclusion whether the overall trend in Net Profit is Favorable or Unfavorable explaining the reasons (Provide at least three reasons). (5 pts, min 100 w.) d) If there was 5% inflation each year, would you change your conclusion for (c)? (Support your answer by numbers and calculations) (10 pts, min 150 w.)