Assume the perpetual inventory system is used. 1) Green Company purchased merchandise inventory that cost $16,200 under terms of 2/10, n/30 and FOB shipping point. 2) Green Company paid freight cost of $620 to have the merchandise delivered. 3) Payment was made to the supplier on the inventory within 10 days. 4) All of the merchandise was sold to customers for $23,900 cash and delivered under terms FOB destination with freight cost amounting to $420. What is the amount of gross margin that results from these transactions?
A. $7604
B. $8024
C. $7404
D. $6984
Answer: C
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