The Following Data Were Extracted from the Accounting Records of Dana

The following data were extracted from the accounting records of Dana Designs for the year ended March 31. $$\begin{array} { | l | r | } \hline \text { Merchandise inventory, April } 1 & \$ 530,000 \\\hline \text { Merchandise inventory, March } 31 & 375,000 \\\hline \text { Purchases } & 270,000 \\\hline \text { Purchase returns and allowances } & 25,000 \\\hline \text { Purchase discounts } & 10,000 \\\hline \text { Sales } & 770,000 \\\hline \text { Freight-in } & 3,000 \\\hline\end{array}$$ Prepare the gross profit and cost of merchandise sold section of the income statement for the year ended March 31, using the periodic method.