Reference no: EM132546628

Sandy Corporation has provided the following cost data for last year when 50,000 units were produced and sold:

Raw materials $200,000

Direct labor 100,000

Manufacturing overhead 200,000

Selling and administrative expense 150,000

All costs are variable except for $100,000 of manufacturing overhead and $100,000 of selling and administrative expense.

Question 1: If the selling price is $12 per unit, the net operating income from producing and selling 120,000 units would be:

Option a) $460,000

Option b) $160,000

Option c) $85,000

Option d) $105,000