Southland Company uses the periodic inventory method. The following balances were drawn from the accounts of Southland Company prior to the closing process: The amount of gross margin appearing on the income statement should be:

Question

Southland Company uses the periodic inventory method. The following balances were drawn from the accounts of Southland Company prior to the closing process:  The amount of gross margin appearing on the income statement should be:

Quizplus · Accepted Answer

Cost of goods sold = $3,200 + 8,000 + $400 - $200 - $3,600 = $7,800
Gross margin = $12,000 Sales - $7,800 COGS = $4,200

Southland Company Uses the Periodic Inventory Method