The management of Harlow Corporation, a manufacturing company, would like your h
ID: 2345325 • Letter: T
Question
The management of Harlow Corporation, a manufacturing company, would like your help in contrasting the traditional and contribution approaches to the income statement. The company has provided the following financial data for January:Sales $245,000
Variable production expense $31,000
Fixed production expense $37,000
Variable selling expense $20,000
Fixed selling expense $28,000
Variable administrative expense $10,500
Fixed administrative expense $50,000
The company had no beginning or ending inventories.
The gross margin for January was:
Explanation / Answer
Gross margin = sales minus cost of goods sold (which is the production costs) = 245,000 - 31,000 - 37,000 = 177,000 answer: $177,000
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