A merchandiser reports gross profit on its income statement to demonstrate which of the following:

a. How much the company earns after deducting the direct cost of the goods purchased (cost of goods sold/ cost of sales) from the net sales (gross sales less sales discounts, sales returns, and allowances) of the merchandise sold

b. How much the company earns after deducting both the direct cost of goods purchased and operating expenses from net sales

c. How much the company earns after deducting all expenses, including income taxes, from net sales

d. All of the above.