Smith Company engaged in the following transactions during2007: 1) Started the b

Question

Smith Company engaged in the following transactions during2007:

1) Started the business by issuing $7,450 of common stock forcash.
2) The company paid cash to purchase $4,520 of inventory.
3) The company sold inventory that cost $3,100 for $7,300 cash.
4) Operating expenses incurred and paid during the year,$2,550.

Smith Company engaged in the following transactions during2008:
1) The company paid cash to purchase $5,790 of inventory.
2) The company sold inventory that cost $7,010 for $15,240cash.
3) Operating expenses incurred and paid during the year,$3,570.

Note: Smith uses the perpetual inventory system.
Smith's gross margin for the year 2008 is:
$9,530. $7,430. $8,730. $8,230. Smith Company engaged in the following transactions during2007:

1) Started the business by issuing $7,450 of common stock forcash.
2) The company paid cash to purchase $4,520 of inventory.
3) The company sold inventory that cost $3,100 for $7,300 cash.
4) Operating expenses incurred and paid during the year,$2,550.

Smith Company engaged in the following transactions during2008:
1) The company paid cash to purchase $5,790 of inventory.
2) The company sold inventory that cost $7,010 for $15,240cash.
3) Operating expenses incurred and paid during the year,$3,570.

Note: Smith uses the perpetual inventory system. Smith's gross margin for the year 2008 is: $9,530. $7,430. $8,730. $8,230. $9,530. $7,430. $8,730. $8,230.

Explanation / Answer

Smith's gross margin - $ 8,230 Explanation 2008 Sales                     15,240 -cost of goodssold         7,010 GrossMargin                 8,230

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