The Gross Margin for Cushing Company for the First Quarter

question 69

Multiple Choice

The gross margin for Cushing Company for the first quarter of last year was $325,000 when sales were $700,000.The beginning inventory of finished goods was $60,000,and the ending inventory of finished goods was $85,000.What was the cost of goods manufactured for the first quarter?

• A) $375,000.
• B) $350,000.
• C) $400,000.
• D) $385,000.= (700,000 - 325,000)+ 85,000 - 60,000 = $400,000.

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Definitions:

Subsidy

A financial contribution provided by government to reduce the cost of producing goods or services and support businesses or consumers.

External Costs

Costs of an economic activity that are not borne by the parties directly involved in the transaction but by other individuals or society at large.

Supply Curve

A graph that represents the relationship between the price of a good and the quantity of the good that suppliers are willing to offer for sale.

Socially Optimal

A condition that maximizes societal welfare, often referring to the optimal distribution of resources and goods.