Presented below are the comparative income statements for Simple Things Design Group, Inc.: Net sales Simple Things Design Group, Inc. Comparative Income Statements For the Years Ended December 31, 2007 and 2006 2007 $3,470,000$3.350,000 2006 Styles Expenses: Cost of goods sold $2,082,000 $1,992,000 Selling expenses 105,000 80,000 General expenses 291,000 350,000 Interest expense 10,000 10,000 Income tax expense 265,000 60.000 Total expenses 2.753.000 2.492,000 Net income $717.000 S858.000 Required: a. Prepare a vertical analysis of the income statement showing appropriate percentages for each item listed above. Round percentages to one-tenth percent. b. Why did net income increase faster than net sales? Styles The income statement of Tavis Corporation and selected additional data are presented below: Tavis Corporation Income Statement For the Year Ended December 31, 2006 Net sales $194,000 Cost of goods sold 93.000 Gross profit 101,000 Selling and general expenses 66,000 Income from operations 35,000 Interest expense 9.000 Income before income tax 26,000 Income tax expense 8,000 $ 18.000 Net income Additional data: Total assets I $204,000 Common stockholders' equity Preferred dividends $.96.000 $ 4,000 Required Calculate the following ratios for the current year a return on sales b. return on assets c return on equity