Answer:
$71,240
Explanation:
The computation of the total gross margin under absorption costing is shown below:
As we know that
Gross Margin = Sales - Variable Manufacturing Cost - Fixed Manufacturing Overhead For Units Sold
Sales (2,740 units × $131) $358,940
Less Manufacturing Costs
Direct Materials (2,740 units × $44) $120,560
Direct Labor (2,740 units × $19) $52,060
Variable Manufacturing Overhead (2,740 units × $13) $35,620
Fixed Manufacturing Overhead ($85,260 ÷ 2,740 units ÷ 2,940 units) $79,460
Gross Margin $71,240
We simply applied the above formula
