Cost of goods manufactured and sold The following information pertains to Pandey Manufacturing Company for March 2012. Assume actual overhead equaled applied overhead.

Required
a. Prepare a schedule of cost of goods manufactured and sold.
b. Calculate the amount of gross margin on the income statement.

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March 1 Inventory balances Raw materials $125,000 120,000 78,000 Work in process Finished goods March 31 Inventory balances Raw materials $ 85,000 145,000 80,000 Work in process Finished goods During March Costs of raw materials purchased Costs of direct labor $120,000 100,000 63,000 350,000 Costs of manufacturing overhead Sales revenues