Year $2$ Year $1$ a$.$ Prepare common size income statements for Price Company, a sole proprietorship, for the two years shown as above by converting

the dollar amounts into percentages. For each year, sales will appear as $100$ percent and other items will be expressed as a

percentage of sales. $($Income taxes are not involved as the business is not incorporated.$)$

b$.$ State whether the changes from year $1$ to year $2$ are favorable or unfavorable.

Complete this question by entering your answers in the tabs below.

Prepare common size income statements for Price Company, a sole proprietorship, for the two years shown as above by

converting the dollar amounts into percentages. For each year, sales will appear as $100$ percent and other items will be

expressed as a percentage of sales. $($Income taxes are not involved as the business is not incorporated.$)($Round your

percentage value answers to $2$ decimal places. i$.$e$.0\mathrm{.}1234$ as $12\mathrm{.}34\%.)$

Sales $ $544,000$ $ $407,000$

Cost of goods sold $330,000268,000$

Gross profit $ $214,000$ $ $139,000$

Operating expenses $130,000116,000$

Net income $ $84,000$ $ $23,000$

a$.$ Prepare common size income statements for Price Company, a sole proprietorship, for the two years shown as above by converting the dollar amounts into percentages. For each year, sales will appear as $100$ percent and other items will be expressed as a percentage of sales. $($Income taxes are not involved as the business is not incorporated.$)$

b$.$ State whether the changes from year $1$ to year $2$ are favorable or unfavorable.