Three years ago, Karen Suez and her brother-in-law Reece Jones opened Novak Corporation. For the first two years, business was good, but the following condensed income results for 2022 were disappointing. Karen believes the problem lies in the relatively low gross profit rate (gross profit divided by net sales) of 20%. Reece believes the problem is that operating expenses are too high. Karen thinks the gross profit rate can be improved by making two changes. She does not anticipate that these changes will have any effect on operating expenses. 1. Increase average selling prices by 15%. This increase is expected to lower sales volume so that total sales will increase only 4% 2. Buy merchandise in larger quantities and take all purchase discounts. These changes to selling prices and purchasing practices are expected to increase the gross profit rate from 20% to a new rate of 25%. Reece thinks expenses can be cut by making these two changes. He feels that these changes will not have any effect on net sales. 1. Cut 2023 sales salaries of $60,000 in half and give sales personnel a commission of 2% of net sales. 2. Reduce store deliveries to one day per week rather than twice a week. This change will reduce 2023 delivery expenses of $40,000 by 40%. Karen and Reece come to you for help in deciding the best way to improve net income. Answer the following. Your answer has been saved. See score details after the due date. Prepare a condensed income statement for 2023 , assuming Karen's changes are implemented. (If there is a net loss then enter the amount using either a negative sign preceding the number e.g. 45 or parentheses e.g. (45).) Prepare a condensed income statement for 2023 , assuming Reece's ideas are adopted. (If there is a net loss then enter the amount using either a neantive cign nrereding the numher e.q. 45 or narentheses e q. (45).l Novak Corporation Income Statement $ Save for Later Attempts: 0 of 1 used Submit