Smith Company engaged in the following transactions during 2018. 1) Started the business by issuing $7,500 of common stock for cash. 2) The company paid cash to purchase $4,500 of inventory. 3) The company sold inventory that cost $3,000 for $7,250 cash. 4) Operating expeneses incurred and paid during the year, $2,500. Smith Company engaged in the following transactions during 2019: 1) The company paid cash to purchase $5,800 of inventory. 2) The company sold inventory that cost $7,000 for $15,150 cash. 3) Operating expenses incurred and paid during the year, $3,500. Note: Smith uses the perpetual inventory system. Smith's gross margin for year 2019 is:

$4,250

$7,560

$8,150

$9,350