The following income statements were drawn from the annual reports of Harper Sales Company.

2014* 2015* Net sales $ 200,000 $ 250,000 Cost of goods sold (140,000 ) (170,000 ) Gross margin 60,000 80,000 Less: Operating expense Selling and administrative expenses (28,000 ) (32,000 ) Net Income $ 32,000 $ 48,000

*All dollar amounts are reported in thousands.

The presidents message in the companys annual report stated that the company had implemented a strategy to increase market share by spending more on advertising. The president indicated that prices held steady and sales grew as expected. Prepare common size income statements for 2014 and 2015.

HARPER SALES COMPANY Income Statement For the Years Ended December 31, 2014 and 2015 2014 2015 % % % %

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