The two-year comparative income statements and a note disclosure for Mercury Shoes Inc. were as follows:

1. Divide each amount in the 2008 and 2007 income statements by total sales for the given year.
2. Interpret the performance of the company in 2008 .obj. 5

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Income Statement Mercury Shoes Inc. For the Years Ended December 31, 2008 and 2007 Sales Cost of merchandise sold Gross profit Selling and administrative expenses Loss on fixed asset impairment Income from operations Income tax expense Net income 2008 2007 $510,000 $430,000 224,400 193,500 $285,600 $236,500 122,400 107,500 127,500 $ 35,700 14,280 $ 21,420 $129,000 51,600 $ 77,400