Chown Company, Which Has Only One Product, Has Provided the Following

question 50

Multiple Choice

Chown Company, which has only one product, has provided the following data concerning its most recent month of operations:
$\begin{array}{l|r|}\hline \text { Selling price } & \$ 110 \\\hline \text { Units in beginning inventory } & 0 \\\hline \text { Units produced } & 8,000 \\\hline \text { Units sold } & 7,800 \\\hline \text { Units in ending inventory } & 200 \\\hline \text { Variable costs per unit: } & \\\hline \text { Direct materials } & \$ 22 \\\hline \text { Direct labour } & \$ 31 \\\hline \text { Variable manufacturing overhead } & \$ 3 \\\hline \text { Variable selling and administrative } & \$ 4 \\\hline \text { Fixed costs: } & \\\hline \text { Fixed manufacturing overhead } & \$ 248,000 \\\hline \text { Fixed selling and administrative } & \$ 140,400 \\\hline\end{array}$

-What was the total gross margin for the month under the absorption costing approach?

• A) $7,800.
• B) $179,400.
• C) $196,800.
• D) $390,000.

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