Question

Bolka Corporation, a merchandising company, reported the following results for October:

Sales	$	407,000
Cost of goods sold (all variable)	$	173,400
Total variable selling expense	$	20,400
Total fixed selling expense	$	22,200
Total variable administrative expense	$	14,800
Total fixed administrative expense	$	39,700

The gross margin for October is:

A) $198,400

B) $233,600

C) $345,100

D) $136,500

Answer 1

Option B - $233,600

Bolka Corporation
Sales	407,000
Cost of goods sold	173,400
Gross Margin	233,600
Formula
Gross Margin	Sales less Cost of goods sold
Gross Margin	=407,000-173,400