City Computers reported the information shown as follows:

i$)($Click the icon to view the income statement.$)($Click the icon to view the balance sheet.$)$

Required

Is City Computers a merchandising entity, a service business, or both? How can you tell? List the items in City Computers' financial statements that influence your answer.

Compute City Computers' gross margin for fiscal years $2023$ and $2022.$ Did the gross margin increase or decrease in $2023?$ Is this a good sign or a bad sign about the company?

Requirement $1.$ Is City Computers a merchandising entity, a service business, or both? How can you tell? List the items in City Computers' financial statements that influence your answer.

City Computers is

Income statement

Balance sheet