For 2015, Engels Industries Inc. initiated a sales promotion campaign that included the expenditure of an additional $40,000 for advertising. At the end of the year, Diane Heaney, the president, is presented with the following condensed income statement:

Instructions
1. Prepare an income statement for the two-year period, presenting an analysis of each item in relationship to net sales for each of the years. Round to one decimal place.
2. Was the advertising campaign successful? Did the additional cost result in a proportionate increase in net income?

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Engels Industries Inc. Income Statement For the Years Ended December 31, 2015 and 2014 2015 2014 Sales..... $525,000 25,000 $420,000 Sales returns and allowances. 20.000 Net sales..... Cost of goods sold... Gross profit..... Selling expenses... Administrative expenses Total operating expenses. Income from operations.. Other income ..... Income before income taxes. Income taxes expense. 500,000 400,000 280.000 220,000 220.000 180,000 130.000 80.000 65.000 56.000 195,000 136,000 25,000 44,000 30.000 55,000 24.000 .... 68,000 35.000 $ 20,000 28,000 $ 40,000 Net income...