The following data is from the income statement of Ralston Company: Assume the perpetual inventory method is used. 1) The company purchased $12, 500 of merchandise on account under terms 2/10, n/30. 2) The company returned $1, 200 of merchandise to the supplier before payment was made. 3) The liability was paid within the discount period. 4) All of the merchandise purchased was sold $18, 800 cash. The amount of gross margin from the four transactions is: A. $5, 100 B. $7, 726 C. $6.550. D. $11, 074. Use the following for questions 15-18