Question

Saved Gabuat Corporation, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $ 164 Units in beginning inventory Units produced Units sold Units in ending inventory 0 3,700 3,260 440 51 32 Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative expense Fixed cost Fixed manufacturing overhead Fixed selling and administrative expense $ $ $ $ 6 6 $88,800 $32,600 The total gross margin for the month under the absorption costing approach is: Multiple Choice $121,400

Answer 1

Answer
	Particulars	Amounts	Working
	Sales	$ 534640	= 3260 * 164
Less:	Direct Material	$ -166260	= 3260 * 51
Less:	Direct labor	$ -104320	= 3260 * 32
Less:	Variable Manufacturing Overhead	$ -19560	= 3260 * 6
Less:	Fixed Manufacturing Overhead	$ -78240	= (88800 / 3700) * 3260
	Gross Margin for the month under absorption costing Approach:	$ 166260