The following percentages apply to Fanning Company for Year 3 and Year 4: Sales Cost of goods sold Gross margin Selling and administrative expense Interest expense Total expenses Income before taxes Income tax expense Net Income Year 4 100.0% 60.9 39.1 26.2 2.5 28.7 10.4 5.5 4.9% Year 3 100.0% 63.8 36.2 20.6 2.0 22.6 13.6 6.9 6.7% Required Assuming that sales were $505,000 in Year 3 and $600,000 in Year 4. prepare income statements for the two years, Required Assuming that sales were $505,000 in Year 3 and $600,000 in Year 4. prepare income statements for the two years. FANNING COMPANY Income Statements Year 4 Year 3 Sales 0 0 Cost of goods sold Gross margin Selling and administrative expenses Interest expense Total expenses Income before taxes Income tax expense Net income 0 0 S 05 0