Escrow Company's multistep income statement shows cost of goods sold of $60,000, a gross margin of $42,000, operating income of $12,000 and a $20,000 loss on the sale of land. Based on this information, the net income or (net loss) amounted to

A. $12,000.
B. ($20,000).
C, ($8,000).
D. None of the answers is correct.

C, ($8,000).

Step-by-step explanation:

What we have to note here is that operating income is the final income after cost of goods sold, depreciation, operating costs etc.

So the profit is = $12000

Loss on the sale of land = $20,000

So Net income = Total income - Total loss

                        = 12000 - 20000

                        = -8000

So the answer is ($8000) which shows that the company bears the loss of $8000 in the end.

Please note down that we have neglected the cost of goods sold and gross margin because operating income is the final income after  COGS and operating costs so the important figure is only the operating income which is $12000.