Morrisey & Brown, Ltd., of Sydney, Australia, is a merchandising firm that is the sole distributor of a product that is increasing in popularity among Australian consumers. The company's income statements for the three most recent months follow Sales in units Sales revenue MORRISEY & BROWN, LTD. Income Statements For the Four Quarters Ending December 31 Less: Cost of goods sold Gross margin Less: Operating expenses: Advertising expense Shipping expense Salaries and commissions Insurance expense Depreciation expense Total operating expenses Net income Quarter 1 4,600 Quarter 2 4,100 Quarter 3 Quarter 4 5,120 4,700 A$460,000 A$410,000 276,000) 246,000 184,000 164,000 A$512,000 A$470,000 307,200 282,000 204,800 188,000 21,100 21,100 21,100 21,100 34,400 36,400 40,480 36,380 78,600 78,200 90,440 85,580 6,100 6,100 6,100 6,100 15,100 15,100 15,100 15,100 173,220 164,260 A$ 25,700 A$ 7,100 AS 31,580 A$ 23,740 155,300 156,900 (Note: Morrisey & Brown, Ltd.'s Australian-formatted income statement has been recast into the format common in Canada. The Australian dollar is denoted by AS)