Operations for Simple Strategies Company for 2007 and 2008 are summarized here.

Instructions:
1. Prepare common-size income statements for 2008 and 2007.
2. Comment on Simple Strategies€™ profitability in 2008 relative to2007.

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2008 2007 $510,000 $480,000 250,000 Net sales Cost of goods sold Gross profit Selling and general expenses Operating income Other expenses. Income (loss) before income taxes Income taxes (refund) 370,000 80,000 70,000 $140.000 $230000 00,000 60,000 $130,000 60,000 $ (10,000 70,000 (4.000)28,000 ..(6,000) 42,000 Net income (loss)