Answer:
Instructions are below.
Explanation:
<u>First, we need to calculate the cost of goods manufactured using the following formula:</u>
cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP
cost of goods manufactured= 118,400 + (123,900 + 118,900 - 85,500) + 100,500 + 62,800 - 145,200
cost of goods manufactured= $293,800
<u>Now, we can determine the cost of goods sold:</u>
COGS= beginning finished inventory + cost of goods manufactured - ending finished inventory
COGS= 77,400 + 293,800 - 80,900
COGS= $290,300
<u>Finally, the gross margin:</u>
Gross margin= sales - cogs
Gross margin= 356,000 - 290,300
Gross margin= $65,700
