Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current Year Previous Year Sales $590,000 $525,000 Cost of merchandise sold 348,100 283,500 Selling expenses 94,400 94,500 Administrative expenses Income tax expense 106,200 17,700 89,250 21,000 a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers. Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Current year Amount Current year Percent Previous year Amount Previous year Percent Sales $590,000 % $525,000 % Cost of merchandise sold 348,100 % 283,500 % % % Selling expenses 94,400 % 94,500 % Administrative expenses 106,200 % 89,250 % % % % % Income tax expense 17,700 % 21,000 % % % b. The vertical analysis indicates that the cost of merchandise sold as a percent of sales administrative expenses by 1 percentage points. Thus, net income as a percent of sales by 5 percentage points, while selling expenses by 2 percentage points, and by 3 percentage points.