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Vertical Analysis of Income Statement for 2012, T-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $17,000 for advertising. At

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Vertical Analysis of Income Statement for 2012, T-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $17,000 for advertising. At the end of the year, Lumi Nee the president, is presented with the following condensed comparative income statement: Tri-Comic Company Comparative Income Statement For the Years Ended December 31, 2012 and 2041 2012 2011 Sales 5593,000 $510,000 Cost of goods sold 296,500 280,500 Gross profit 5296,500 $229,500 Selling expenses 5116,600 596,900 Administrative expenses 59,300 61,200 total operating expenses $177,900 $158.100 Income from operations $118.600 571,400 Other revenue 29,650 30.600 Income before income 5146,250 $107.000 Income tax expense 59,300 40,000 Netice 588,950 361,200 Itequired 1. Prepare a comparative comment for the two year period, presenting all analysis of each item in relationship to sales for each of the Enterprise bers Inter amount as ponte nubes 1. Prepare a comparative income statement for the two year penod, presenting an analysis of each item in relationship to sales for each of the years. Enter percentages as whole numbers. Enter all amounts as positive numbers Tri Comic Company Comparative Income Statement For the Years Ended December 31, 2012 and 2041 2012 Amount 20Y2 Percent 20Y1 Amount 2018 Percent Sales 3593,000 % $510,000 Cost of goods sold 296,500 280,500 Gross profit $296,500 50 $229,500 Selling expenses $118.600 596,900 Administrative expenses 59,300 61,200 96 Total operating expenses $177,900 $158,100 Discome from operations $118,600 571,400 Other even 29,650 30,600 Income before income tax 5148.250 $102,000 Income tax expense 59,300 40,800 Met income $88.950 561,200 2. The vertical analysis indicates that the costs other than selling expenses (cost of goods sold and adminstrative expenses) net income as a percentage of sales The sales promotion campaign appears to have been bitly, the cost was more than made up for by is a percentage of sales. As a While selling expresserent

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