Presented Are the Income Statements of Haley and Johnston Publications

Presented are the income statements of Haley and Johnston Publications companies for the current year: $\begin{array}{|l|l|l|l|l|}\hline & \text { Haley } & & \text { Johnston } & \\\hline \text { Net sales revenue } & \$ 487,000 & 100.00 \% & \$ 500,000 & 100.00 \% \\\hline \text { COGS } & 400,000 & 82.14 \% & 395,000 & 79.00 \% \\\hline \text { Gross Profit } & 87,000 & 17.86 \% & 105,000 & 21.00 \% \\\hline \text { Selling/Gen Expenses } & \underline{30,000} & 6.16 \% & 50,000 & 10.00 \% \\\hline \text { Income from operations } & 57,000 & 11.70 \% & 55,000 & 11.00 \% \\\hline \text { Income tax expense } & 17,100 & 3.51 \% & 16,500 & 3.30 \% \\\hline \text { Net Income } & \$ 39,900 & 8.19 \% & \$ 38,500 & 7.70 \% \\\hline\end{array}$

- What should Johnston do to improve its performance to match or to exceed Haley's performance?

A) Reduce percentage of COGS.
B) Reduce percentage of income tax expense.
C) Reduce percentage of selling/general expenses.
D) Any of the above would be useful to improve performance.