Exercise 15-1 Common-Size Income Statement (LO15-1) A comparative income statement is given below for McKenzie Sales, Ltd., of Toronto: Last Year $5,593,600 3,510,000 2,083,600 McKenzie Sales, Ltd. Comparative Income Statement This Year Sales $7,360,000 Cost of goods sold 4,650,000 Gross margin 2,710,000 Selling and administrative expenses: Selling expenses 1,383,000 Administrative expenses 711,000 Total expenses 2,094,000 Net operating income 616,000 Interest expense 103,000 Net income before taxes $ 513,000 1,079,000 616,000 1,695,000 388,600 89,000 $ 299,600 Members of the company's board of directors are surprised to see that net income increased by only $213,400 when sales increased by $1,766,400. Required: 1. Express each year's income statement in common-size percentages. (Round your percentage answers to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) This Year Last Year Sales % % % % Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses % % Administrative expenses % % % % Total selling and administrative expenses Net operating income % % Interest expense % % Net income before taxes % %