Callaway Corp

Multiple Choice

Callaway Corp., which began business at the start of the current year, had the following data: Planned and actual production: 40,000 units Sales: 38,000 units at $15 per unit Production costs: Variable: $5 per unit Fixed: $260,000 Selling and administrative costs: Variable: $1 per unit Fixed: $32,000 The gross margin that the company would disclose on an absorption-costing income statement is:

A) $0.
B) $133,000.
C) $166,500.
D) $342,000.
E) None of the answers is correct.