Calculate the gross margin

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Reference no: EM132920820

Problems -

1. Keller Corp. manufactures jeans. Costs incurred in making 20,000 pairs of jeans in May included $510,000 of fixed manufacturing overhead. Total absorption cost per pair of jeans was $50.

a. Calculate the variable cost per pair of jeans.

b. Express the cost of the jeans in a cost formula (Y=a+bX).

2. A product's unit cost is $18 for direct materials used, $17 for labor incurred, and $15 for variable manufacturing overhead; its unit selling price is $150. Selling, general, and administrative expenses for the month were $200,000.

a. Calculate the total product cost (COGM).

b. Assuming 10,000 products were produced and sold, calculate the gross margin, gross margin ratio, and net income for the month.

Reference no: EM132920820

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