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Problem 1: Last year, fixed manufacturing overhead costs were $30,000, variable production costs were $48,000, fixed selling and administration costs were $20,000, and variable selling administrative expenses were $9,600. Beginning inventory was 400 units with a cost of $14,400. During the year, 3,000 units were produced and 2,400 units were sold at a price of $41 per unit. Under absorption costing, what would be the operating income(loss)?
Multiple Choice
Option 1: $4,000. Option 2: $2,400. Option 3: $0. Option 4: ($4,000).
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