A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:Selling price $ 139Units in beginning inventory 0Units produced 2,990Units sold 2,760Units in ending inventory 230Variable costs per unit:Direct materials $ 50Direct labor $ 15Variable manufacturing overhead $ 12Variable selling and administrative expense $ 9Fixed costs:Fixed manufacturing overhead $ 107,640Fixed selling and administrative expense $ 24,840The total gross margin for the month under absorption costing is

Gross margin= $71,760

Explanation:

The absorption costing method includes all costs related to production, both fixed and variable. The unit product cost is calculated using direct material, direct labor, and total unitary manufacturing overhead.

First, we need to calculate the unitary production cost:

Unitary production  costs= (107,640 / 2,990) + 50 + 15 + 12

Unitary production costs= $113

Now, the gross margin:

Gross margin= sales - cost of goods sold

Gross margin= 2,760*139 - 2,760*113

Gross margin= $71,760

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