Vertical analysis of income statement For 2012, Fielder Industries Inc. initiated a sales promotion campaign that included the expenditure of an additional $40,000 for advertising. At the end of the year, Leif Grando, the president, is presented with the following condensed comparative income statement: Fielder Industries Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 Sales 20Y2 20Y1 $1,300,000 $1,180,000 Cost of goods sold Gross profit Selling expenses Administrative expenses (682,500) (613,600) $617,500 $566,400 $(260,000) $(188,800) (169,000) (177,000) Total operating expenses $(429,000) $(365,800) Operating income $188,500 $200,600 Other revenue 78,000 70,800 Income before income tax expense $266,500 $271,400 Income tax expense (117,000) $149,500 (106,200) $165,200 Net income Required: 1. Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to sales for each of the years. Round to one decimal place. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Fielder Industries Inc. Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 20Y2 20Y2 20Y1 20Y1 Amount Percent Amount Percent Line Item Description Sales $1,300,000 % $1,180,000 % Cost of goods sold (682,500) % (613,600) % Gross profit $617,500 % $566,400 % Selling expenses $(260,000) % (188,800) % Administrative expenses (169,000) % (177,000) % Total operating expenses $(429,000) % $(365,800) % Operating income Other revenue $188,500 78,000 % $200,600 % % 70,800 % Income before income tax expense $266,500 Income tax expense (117,000) % % $271,400 (106,200) % % Net income $149,500 % $165,200 % 2. The net income as a percent of sales has 20Y2. Selling expenses as a percent of sales, however, have All the costs and expenses, other than selling expenses, have maintained their approximate cost as a percent of sales relationship between 20Y1 and Apparently, the new advertising campaign been successful. The increased expense produced sufficient sales to maintain relative profitability. Thus, selling expenses as a percent of sales have