Webster, Inc Required:
A

Essay

Webster, Inc. began operations at the start of the current year, having a production target of 60,000 units. Actual production totaled 60,000 units, and the company sold 95% of its manufacturing output at $50 per unit. The following costs were incurred: $$\begin{array}{l}\text { Manufacturing: }\\\begin{array} { l r } \text { Direct materials used } & \$ 240,000 \\\text { Direct labor } & 480,000 \\\text { Variable manufacturing overhead } & 360,000 \\\text { Fixed manufacturing overhead } & 600,000 \\\text { ling and administrative: } & \\\text { Variable } & 180,000 \\\text { Fixed } & 630,000\end{array}\end{array}$$
Required:
A. Assuming the use of variable costing, compute the cost of Webster's ending finished-goods inventory.
B. Compute the company's contribution margin. Would Webster disclose the contribution margin on a variable-costing income statement or an absorption-costing income statement?
C. Assuming the use of absorption costing, how much fixed selling and administrative cost would Webster include in the ending finished-goods inventory?
D. Compute the company's gross margin.