QUESTION 16 Reference: 08-02 Last year, Walsh Company manufactured 25,000 units and sold 22,000 units. Production costs were as follows: Direct materials $100,000 175,000 Variable manufacturing overhead 150,000 Fixed manufacturing overhead 175,000 Total sales were $440,000, total variable selling and administrative expenses were $110,000, and total fixed selling and administrative expenses were $45,000. There was no beginning inventory. Assume that direct labour is a variable cost. Direct labour Under absorption costing what was the gross margin? $21,000 $176,000 $242,000. $66,000