Schumacher Company uses the perpetual inventory system, and it engaged in the fo

Question

Schumacher Company uses the perpetual inventory system, and it engaged in the following transactions during 2014: 1) Started the business by issuing common stock for $7,560 cash 2) Paid cash to purchase $5,020 of inventory 3) Sold inventory that cost $3,030 for $7,310 cash 4) Incurred and paid operating expenses, $252 Schumacher Company engaged in the following transactions during 2015: 1) Paid cash to purchase $5,850 of inventory 2) Sold inventory that cost $7,060 for $15,270 cash 3) Incurred and paid operating expenses, $504 The gross margin for the year 2014 is:

Explanation / Answer

Gross margin for the year 2014 =

sales = 7310

Less- COGS = 3030

Less- operating expense = 252

gross profit = 4028

gross margin = gross profit / sales *100

= 4028 /7560 *100

=53.28%

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