$\backslash$table$[[$BURCH COMPANY$],[$Income Statements$],[,$Year $4,$Year $3],[$Sales$,$$$240,000,$$$200,000],[$Cost of goods sold,$$180,000,\text{'}$$$124,000],[$Selling expenses,$$26,000,$$$20,000],[$Administrative expenses,$$12,000,$$$18,000],[$Interest expense,$$7,500,$$$8,000],[$Total expenses,$$225,500,$$$170,000],[$Income before taxes,$$14,500,$$$30,000],[$Income taxes expense,$$1,200,$$$3,000],[$Net income,$$13,300,$$$27,000]]$

Required

a$.$ Perform a horizontal analysis, showing the percentage change in each income statement component between Year $3$ and Year $4.$

Note: Negative answers should be indicated by a minus sign.

$\backslash$table$[[$H$,$AN$,],[$Horizontal An$,,$ments$],[,,$age Chan$],[,,$Year $3],[$Sales$,$grad,$20\mathrm{.}0\%],[$Cost of goods sold,grad,$45\mathrm{.}2\%],[$Selling expenses,V$,30\mathrm{.}0\%],[$Administrative expenses,$V,],[$Interest expense,grad,$-6\mathrm{.}3\%],[$Total expenses,grad,$],[$Income before taxes,$V,-51\mathrm{.}7\%],[$Income taxes expense,grad,$-60\mathrm{.}0\%],[$Net income $($loss$),$V$,-50\mathrm{.}7\%]]$

b$.$ Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.