Stubbs Company uses the perpetual inventory method. On January 1, Year 1, Stubbs purchased 500 units of inventory that cost $3.00 each. On January 10, Year 1, the company purchased an additional 600 units of inventory that cost $2.75 each. If Stubbs uses a weighted average cost flow method and sells 900 units of inventory for $6.00 each, the amount of gross margin reported on the income statement will be:(Round your intermediate calculations to two decimal places.)

Multiple Choice

• $2,925.
• $2,574.
• $2,800.
• $2,826.