An investor is trying to compare the performance of two companies for year 20X8: Firm A reporting under IFRS, and Firm B reporting under U.S. GAAP. The following reported data are available:

	Firm A	Firm B
Sales	$720,000	$400,000
COGS	560,000	320,000
Depreciation	25,000	12,000
Unrealized holding gains/losses for marketable securities	(5,000) in OCI	(2,000) in I/S
Net Income	70,000	14,000
LIFO Reserve	-	$32,000 for year 20X8, and $12,000 for year 20X7
Number of shares outstanding	100,000	100,000
Development costs (B/S)	12,000 (no amortization yet)	-

The investor identifies the following differences in the accounting policies of the two firms.

	Firm A	Firm B
Sales	Sell-in	Sell-through
Inventory	FIFO	LIFO
Marketable securities	Non-trading	Trading
Certain development costs	capitalized	Expensed
Depreciation	Straight-line	Accelerated

The investor further finds that firm A would double its depreciation cost under accelerated depreciation method based on its tax filing information. In addition, its estimated that if Firm A uses the conservative sell-through revenue recognition, the reported sales and COGS would reduce by about 10%. The investor also believes that the unrealized losses of $5,000 for firm As marketable securities should be charged to the income statement given the firms relatively active trading strategy in the past.

The investor wants to compare the performance of the two firms by using gross profit margin and earnings per share as performance indicators.

Required:

Make necessary adjustments first and compare gross profit margin and earnings per share between the two firms for year 20X8 (ignore tax effect).