Refer to the information provided in E12–2.

Data from in E12-2

The income statements for Federer Sports Apparel for 2025 and 2024 are presented below.

Required:
Prepare a horizontal analysis for 2025 using 2024 as the base year.

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FEDERER SPORTS APPAREL Income Statements For the years ended December 31 Net sales Cost of goods sold Gross profit Operating expenses Depreciation expense Inventory write-down Loss (litigation) Income before tax Income tax expense Net income 2025 $18,800,000 13,200,000 5,600,000 1,600,000 1,000,000 200,000 1,500,000 1,300,000 450,000 $ 850,000 2024 $15,500,000 7,000,000 8,500,000 1,200,000 1,000,000 300,000 6,000,000 2,000,000 $ 4,000,000