Question

How do you find Gross Margin in Absorption Costing?

Answer 1

To find gross margin in absorption costing, subtract the cost of goods sold from the sales revenue.

Step-by-step explanation:

Gross margin in absorption costing can be found by subtracting the cost of goods sold from the sales revenue. It is a measure of the profitability of a product or service and represents the amount of money left over after deducting variable costs.

Here is an example:

Sales revenue: $200,000
- Cost of goods sold: $85,000
Gross margin: $115,000