Razor Inc Manufactures Industrial Components During the Next Year, Sales of Fluoro2211 Are Expected to as a Subcomponent

Multiple Choice

Razor Inc. manufactures industrial components. One of its products used as a subcomponent in auto manufacturing is Fluoro2211. The selling price and cost per unit data for 9,000 units of Fluoro2211 are as follows.
$$\begin{array} { l r } & \text { Per Unit Data }\\\text { Selling Price } & \$ 150 \\\text { Direct Materials } &20 \\\text { Direct Labor } &15 \\\text { Variable Manufacturing Overhead } & 12\\\text { Fixed Manufacturing Overhead } &30 \\\text { Variable Selling } & 3 \\\text { Fixed Selling and Admnistrative } &10\\\text { Total Costs } & 90\\\text { Operating Margin } & \$60\\\end{array}$$
During the next year, sales of Fluoro2211 are expected to be 10,000 units. All costs will remain the same except for fixed manufacturing overhead, which will increase by 20%, and direct materials, which will increase by 10%. The selling price per unit for next year will be $160. Based on these data, Razor Inc.'s total contribution margin for next year will be: (CMA adapted)

A) $882,000.
B) $980,000.
C) $972,000.
D) $1,080,000.