For 2008, Acedia Technology Company initiated a sales promotion campaign that included the expenditure of an additional $10,000 for advertising. At the end of the year, Gordon Kincaid, the president, is presented with the following condensed comparative income statement:

Instructions
1. Prepare a comparative income statement for the two-year period, presenting an analysis of each item in relationship to net sales for each of the years. Round to one decimal place.
2. To the extent the data permit, comment on the significant relationships revealed by the vertical analysis prepared in(1).

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Acedia Technology Company Comparative Income Statement For the Years Ended December 31, 2008 and 2007 2008 2007 $676,000 6,000 5,000 $750,000 274,700 $172,500 82,500 $160,800 80,400 Administrative expenses . ...-... 154,100 6,700 $210,000160,800 53,600 7,500 Income before inco 60,000