Game-On Sports operates in two distinct segments: athletic equipment and accessories. The income statement for each operating segment is presented below.

Required:

1. Complete the “%” columns to be used in a vertical analysis of Game-On Sports’ two operating segments. Express each amount as a percentage of sales.

2. Use vertical analysis to compare the profitability of the two operating segments. Which segment is more profitable?

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GAME-ON SPORTS Income Statement For the year ended December 31, 2021 Athletic Equipment Accessories Amount % Amount % Net sales $3,050,000 $3,500,000 Cost of goods sold 1,350,000 1,670,000 Gross profit Operating expenses Operating income Other income (expense) 1,700,000 1,830,000 750,000 950,000 800,000 1,030,000 80,000 (15,000) Income before tax 1,030,000 1,015,000 Income tax expense 235,000 210,000 $ 805,000 Net income $ 795,000