Exercise3In each of the following equations supply the missing term(s):

1. Net sales = Gross sales (______________________ + Sales returns and allowances).
2. Cost of goods sold = Beginning inventory + Net cost of purchases ________ ________.
3. Gross margin = ________ ________ Cost of goods sold.
4. Income from operations = __________ _________ Operating expenses.
5. Net income = Income from operations + _________ ________ ________ ________.