Income statement data for Grendel Images Company for the years ended December 31, 2010 and 2009, are as follows:

a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for 2010 when compared with 2009. Round to one decimal place.b. What conclusions can be drawn from the horizontalanalysis?

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2010 2009 Sales $196,000 $160,000 Cost of goods sold Gross profit Selling expenses Administrative expenses Total operating expenses 170,100 140,000 $ 25,900 $ 12,200 9,750 $ 21,950 $ 3,950 2,000 $ 1,950 $ 20,000 $ 10,000 8,000 $ 18,000 $ 2,000 Income before income tax Income tax expense 1,000 $ 1,000 Net income