The Following Data Were Taken from the Records of Lilo

The following data were taken from the records of Lilo Corporation for the year ended December 31,2010 $$\begin{array} { l r } \text { Sales of merchandise for cash } & \$ 150,000 \\\text { Sales of merchandise on credit } & 800,000 \\\text { Sales returns and allowances } & 10,000 \\\text { Selling expenses } & 80,000 \\\text { Cost of goods sold } & 610,000 \\\text { Administrative expenses } & 90,000\end{array}$$ The following items have not been included in above amounts:
Estimated bad debt expense is 1% of credit sales.
The income tax rate is 35%.
10,000 of shares of common stock are outstanding.
Requirements:
A.Based on the above data,prepare a multiple-step income statement (including gross profit,pretax income,and earnings per share). B. 1. What was the gross profit ratio?
$\quad$ 2. Explain what gross profit and the gross profit ratio mean.