Just for future reference with this situation, there is a simple way to convert solid color images like this to vector images. (though, your source is compressed jpeg, so it really probably wouldn't work in this situations, but BMP and gif would be fine.)
Anywhich way,
-Import your image (like you said you did)
-Select the image
-Click "Image" then "Mode" then "Monochrome - 1 bit" from the menu at the top
-Click "Image" then "Vectorise"
-Click either "overlay colors" or "inset colors" (I suggest inset for most things)
-Click "OK"
-Size to the size needed and cut!
After doing this a few times it's just second nature. Hope this helped some.
