Vertical analysis Amazon.com, Inc. is the largest Internet retailer in the United States. Amazon's income statements through income from operations for two recent years are as follows (in millions): Amazon.com, Inc. Operating Income Statements For the Years Ended December 31 (in millions) Year 2 Year 1 Product sales $70,080 18,908 $60,903 13,549 Service sales Total sales $88,988 $74,452 Cost of sales $62,752 $54,181 Fulfillment 8,585 Marketing Technology and content 10,766 4,332 9,275 1,552 133 $88,810 3,133 6,565 1,129 General and administrative 114 Other operating expense (income), net Total operating expenses Income from operations $73,707 $178 $745 Required: a. Prepare a vertical analysis of the two operating income statements. Round percentages to one decimal place. Amazon.com, Inc. Operating Income Statements For the Years Ended December 31 (in millions) Year 2 Year 1 Amount Percent Amount Percent Product sales Service sales Total sales Cost of sales Fulfillment Marketing Commons Technology and content General and administrative Other operating expense (income), net Total operating expenses Income from operations b. Use the vertical analysis to explain the decrease in income from operations. The vertical analysis indicates that the income from operations between the two years. Total expenses as a percent of total sales. This is explained by the in fulfillment, marketing, technology and content, and general and administrative expenses. There was a sizable in the cost of sales. However, this was not sufficient to offset the in the other expenses; thus, total expenses and income from operations as a percent of total sales between the two years. Management should investigate the reasons for the expense , paying special attention to technology and content