On March 31 a company needed to estimate its ending inventory to prepare its first quarter financial statements. The following information is available:

Beginning inventory, January 1: $4,000

Net sales: $80,000

Net purchases: $78,000

The company's gross margin ratio is 25%. Using the gross profit method, the cost of goods sold would be:

Question 10 options:

$60,000.

$20,000.

$58,500.

$63,000.

$19,500.