Use the Following Information to Determine the Gross Margin for Pacific

question 56

Essay

Use the following information to determine the gross margin for Pacific States Manufacturing for the year just ended (all amounts are in thousands of dollars):
$\begin{array}{|l|r|}\hline \text { Sales } & \$ 31,800 \\\hline \text { Purchases of direct materials } & \$ 7,000 \\\hline \text { Direct labour } & \$ 5,000 \\\hline \text { Work in process, } 1 / 1 & \$ 800 \\\hline \text { Work in process, } 1 / 31 & \$ 3,000 \\\hline \text { Finished goods inventory, } 1 / 1 & \$ 4,000 \\\hline \text { Finished goods inventory, } 1 / 31 & \$ 5,300 \\\hline \text { Accounts payable, } 1 / 1 & \$ 1,700 \\\hline \text { Accounts payable, } 1 / 31 & \$ 1,500 \\\hline \text { Direct materials inventory, } 1 / 1 & \$ 6,000 \\\hline \text { Direct materials inventory, } 1 / 31 & \$ 1,000 \\\hline \text { Indirect labour } & \$ 600 \\\hline \text { Indirect materials used } & \$ 500 \\\hline \text { Utilities expense, factory } & \$ 1,900 \\\hline \text { Depreciation on factory equipment } & \$ 3,500 \\\hline\end{array}$

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Definitions:

White-Collar Workers

Employees who perform professional, managerial, or administrative work, often in office settings, as opposed to manual labor.

Treaty of Detroit

This historically refers to any of several agreements made in the 18th and early 19th centuries, often involving land transactions or peace treaties between Native American tribes and colonial or federal governments around the Detroit area.

United Auto Workers

A labor union in the United States and Canada representing workers in the automotive industry, advocating for workers' rights and benefits.

General Motors

An American multinational corporation headquartered in Detroit, Michigan, that designs, manufactures, markets, and distributes vehicles and vehicle parts.