Vertical Analysis of Income Statement For 20Y2, Tri-Comic Company initiated a sales promotion campaign that included the expenditure of an additional $21,000 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 2041 20Y2 20Y1 $746,000 $642,000 Sales Cost of goods sold Gross profit 350,620 333,840 $395,380 $308,160 Selling expenses $156,660 $128,400 82,060 83,460 Administrative expenses Total operating expenses $238,720 $211,860 Income from operations $156,660 $96,300 Other income 22,380 Income before income tax $179,040 74,600 38,520 $134,820 51,360 $83,460 Income tax expense Net income $104,440 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 2041 2082 Amount 20Y2 Percent 20Y1 Amount 20Y1 Percent $746,000 % $642,000 Sales Cost of goods sold 350,620 333,840 Gross profit $395,380 $308,160 Selling expenses 156,660 128,400 Administrative expenses 82,060 83,460 Total operating expenses $238,720 $211,860 Income from operations $156,660 $96,300 38,520 Other income 22,380 Income before income tax $179,040 $134,820 Income tax expense 74,600 51,360 Net income $104,440 $83,460 2. The vertical analysis indicates that the costs other than selling expenses (cost of goods sold and administrative expenses) deteriorated as a percentage of sales. As a result, net income as a percentage of sales decreased . The sales promotion campaign appears to have been unsuccessful . While selling expenses as a percent of sales decreased slightly, the decreased cost was more than made up for by sales