The following information was developed from the financial statements of Donelson, Inc. At the beginning of 2018, the company's former supplier went bankrupt, and the company began buying merchandise from another supplier.

20182017

Gross profit on sales$1,000,000$1,134,000

Income before income tax230,400252,000

Net income172000189,000

Net income as a percent of sales6%7.5%

Required:

a.what is the net sales for each year.

b.what is the cost of goods sold in dollars and as a percentage of net sales for each year.

c.what is the operating expenses in dollars and as a percentage of net sales for each year. (Income taxes expense is not an operating expense.)

d.Construct a condensed comparative income statement for 2017 and 2018. Include the following items: net sales, cost of goods sold, gross profit, operating expenses, income before income tax, income taxes expense, and net income.