Vertical Analysis of Income Statement For 2012, Tri-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 Neer, the president, is presented with the following condensed comparative income statement: Tri-Comic Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 20Y1 Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses Income from operations Other income 2012 20Y1 $621,000 $534,000 316,710 299,040 $304,290 $234,960 $130,410 $106,800 68,310 69,420 $198,720 $176,220 $105,570 $58,740 24,840 16,020 $130,410 $74,760 49,680 $80,730 32,040 $42,720 Income before income tax Income tax expense 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. 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 20Y1 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. Enter percentages as whole numbers. Enter all amounts as positive numbers. Tri-Comic Company Comparative Income Statement For the Years Ended December 31, 20Y2 and 2011 2012 Amount 20Y2 Percent 20Y1 Amount 20Y1 Percent Sales $621,000. % $534,000 % Cost of goods sold 316,710 % 299,040 % Gross profit $304,290 % $234,960 % Selling expenses 130,410 106,800 % Administrative expenses 68,310 % 69,420 % Total operating expenses $198,720 % $176,220 % Income from operations $105,570 % $58,740 % Other income 24,840 % 16,020 % Income before income tax $130,4101 % $74,760 % Income tax expense 49,680 % 32,040 % Net income $80,730 % $42,720 % 2. The vertical analysis indicates that the costs other than selling expenses (cost of goods sold and administrative expenses) The sales promotion campaign appears to have been sales. As a result, net income as a percentage of sales i cost was more than made up for by! expenses as a percent of sales, slightly, the as a percentage of While selling sales.