Vertical Analysis of Income Statement

For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $24,000 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
	20Y2		20Y1
Sales	$857,000		$737,000
Cost of goods sold	402,790		375,870
Gross profit	$454,210		$361,130
Selling expenses	$179,970		$147,400
Administrative expenses	94,270		95,810
Total operating expenses	$274,240		$243,210
Income from operations	$179,970		$117,920
Other income	42,850		44,220
Income before income tax	$222,820		$162,140
Income tax expense	85,700		66,330
Net income	$137,120		$95,810

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 20Y1
	20Y2 Amount	20Y2 Percent	20Y1 Amount	20Y1 Percent
Sales	$857,000	%	$737,000	%
Cost of goods sold	402,790	%	375,870	%
Gross profit	$454,210	%	$361,130	%
Selling expenses	179,970	%	147,400	%
Administrative expenses	94,270	%	95,810	%
Total operating expenses	$274,240	%	$243,210	%
Income from operations	$179,970	%	$117,920	%
Other income	42,850	%	44,220	%
Income before income tax	$222,820	%	$162,140	%
Income tax expense	85,700	%	66,330	%
Net income	$137,120	%	$95,810	%