Sales.. Cost of goods sold: Beginning inventory.. Add cost of goods manufactured..... Goods available for sale... Less ending inventory.... Cost of goods sold... Gross margin...... Selling and administrative expenses. Operating income (loss)... Year 1 Year 2 Year 3 $1,000,000 $800,000 $1,000,000 0 0 280,000 800,000 840,000 760,000 800,000 840,000 1,040,000 0 280,000 190,000 800,000 560,000 850,000 200,000 240,000 150,000 170,000 150,000 170,000 $ 30,000 $90,000 $ (20,000) Year 1 Year 2 Year 3 Production in units... 50,000 60,000 40,000 Sales in units... 50,000 40,000 50,000