Question

The income statements for Federer Sports Apparel for 2019 and 2018 are presented below. Required: Prepare a horizontal analysis for 2019 using 2018 as the base year. (Decreases should be indicated with a minus sign. Round your percentage answers to 1 decimal place.) FEDERER SPORTS APPAREL Income Statement For the Years Ended December 31 Increase (Decrease) Year 2019 2018 Amount 18,300,000 15,000,000 S 3,300,000 6,690,600 (3,390,600) Net sales 22.0 13,395,600 6,705,000 Cost of goods sold Gross profit 4,904,400 8,295,000 384,000 Operating expenses 1,464,000 1,080,000 Depreciation expense 878,400 878,400 0.0 109,800 Inventory write-down 109,800 0 Loss (litigation) 1,372,500 1,012,500 360,000 (4,896,900) Income before tax 1,079,700 5,976,600 Income tax expense 347,700 1,860,000 (1,512,300) 732,000 S 4,116,600 Net income

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Federer sports apparel Income statement For the years ended December 31
	Year		Increase (Decrease)
	2,019.00	2,018.00	Amount	%
Net Sales	18,300,000.00	15,000,000.00	3,300,000.00	22.00%
Cost of goods sold	13,395,600.00	6,705,000.00	6,690,600.00	99.79%
Gross profit	4,904,400.00	8,295,000.00	(3,390,600.00)	-40.88%
Operating Expenses	1,464,000.00	1,080,000.00	384,000.00	35.56%
Depreciation expense	878,400.00	878,400.00	-	0.00%
Inventory write - down	109,800.00	-	109,800.00
Loss(Litigation)	1,372,500.00	360,000.00	1,012,500.00	281.25%
Income before tax	1,079,700.00	5,976,600.00	(4,896,900.00)	-81.93%
Income tax expense	347,700.00	1,860,000.00	(1,512,300.00)	-81.31%
Net income	732,000.00	4,116,600.00	(3,384,600.00)	-82.22%