The following data were extracted from the accounting records of Wedgeforth Company for the year ended November

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The following data were extracted from the accounting records of Wedgeforth Company for the year ended November 30, 2010:

Merchandise inventory, December 1, 2009                       $ 210,000

Merchandise inventory, November 30, 2010                       185,000

Purchases                                                                                1,400,000

Purchases returns and allowances                                           20,000

Purchases discounts                                                                   18,500

Sales                                                                                          2,250,000

Freight in                                                                                       14,100

a. Prepare the cost of merchandise sold section of the income statement for the year ended November 30, 2010, using the periodic inventory system.

b. Determine the gross profit to be reported on the income statement for the year ended November 30, 2010.

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