Everett Corporation reported the following operating results for two consecutive years.

Required
a. Compute the percentage changes in Everrett Corporation's income statement components for the two years.
b. Comment on apparent trends revealed by the percentage changes computed in Requirement α
.

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Percentage Change 2011 2012 Sales Cost of goods sold Gross margin Operating expenses Income before taxes Income taxes Net income $440,000 S400,000 176,000 75,000 101,000 45,000 $ 56,000 146,000 65,000 81,000 31,600 $ 49,400