Income Statement Preparation Listed below are the results of Rulon Candies’ operations for 2008 and 2009. (Assume 4,000 shares of outstanding stock for both years.)

Required:
1. Prepare a comparative income statement for Rulon Candies, Inc., for the years ended December 31, 2009, and 2008. Be sure to include figures for gross margin, operating income, income before taxes, net income, and earnings per share.

2. Interpretive Question: What advice would you give Rulon Candies, Inc., to improve its profitability for the year 2010?

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2009 2008 Sales... $300,000 $350,000 Utilities expenses 15,000 8,500 Employee salaries 115,000 110,000 Advertising expenses 10,000 20,000 Income tax expense 9,000 36,500 Interest expense 25,000 15,000 Cost of goods sold 115,000 85,000 Interest revenue 10,000 10,000