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The following income statements were drawn from the annual reports of Harper Sales Company. 2014* 2015* Net sales $ 427,100 $ 522,100 Cost of goods

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

2014* 2015*
Net sales $ 427,100 $ 522,100
Cost of goods sold (303,241 ) (318,481 )
Gross margin 123,859 203,619
Less: Operating expense
Selling and administrative expenses (89,691 ) (109,641 )

Net Income $ 34,168 $ 93,978

*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 and make appropriate references to the differences between 2014 and 2015. (Round your percentage answers to the nearest whole percent (i.e., 0.123 should be considered as 12%.))

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

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