Mausser Woodworking Corporation produces fine cabinets. The company uses a job-order costing system in which its predetermined overhead rate is based on capacity. The capacity of the factory is determined by the capacity of its constraint, which is an automated jointer. Additional information is provided below for the most recent month: The gross margin that would be reported on the income statement prepared for internal management purposes would be closest to:

A) $52,760
B) $3,344
C) $12,644
D) $11,812

To calculate the gross margin, we need to subtract the cost of goods sold (COGS) from the total sales revenue. The COGS includes the direct materials, direct labor, and the overhead costs allocated to the production. From the given information, we can calculate the COGS as follows:

Direct materials: $29,300
Direct labor: $21,880
Overhead (based on the predetermined overhead rate):
Job 191: 3,445 machine-hours × $24.20/hour = $83,299
Job 192: 4,860 machine-hours × $24.20/hour = $117,612
Total overhead = $200,911

Total cost of production = Direct materials + Direct labor + Overhead
Job 191: $29,300 + $21,880 + $83,299 = $134,479
Job 192: $29,300 + $21,880 + $117,612 = $168,792
Total cost of production = $303,271

Total sales revenue = $348,000
COGS = $303,271
Gross margin = Total sales revenue - COGS = $44,729

Therefore, the gross margin that would be reported on the income statement prepared for internal management purposes is $12,644 (28.3% of total sales revenue) which is option C.