Question

Required Information Peaceman Company, which has only one product, has provided the following data concerning its most recent month of operations: $1171 1.700 1.40 Selling price its is beginning inven units produced Units Bold Unite in ending inventory Variable costs per units birect materiale Direct labour Variable facturing overhead Variable selling and administrative Fixed costs Fixed facturing overhead Fixed selling and administrative $11 $89,300 $26,400 What was the total gross margin for the month? Multiple Choice O $123,200 o $85.000

Answer 1

Solution:

Gross Margin = $171600

Calculations:

Marginal Costing
	Units	Price per Unit	Amount	Amount
Sales Revenue	4400	117		514800
Less: Marginal Cost of Sales
Opening Stock	0	0	0
Production Cost	4700	78	366600
Less: Closing Stock	300	78	23400
Marginal Cost of Sales				343200
Gross Margin				171600

Production Cost - 4700 Units	Per Unit	Total
Direct Materials	36	169200
Direct Labor	38	178600
Variable Manufacturing Cost	4	18800
Total	78	366600