A Manufacturing Company Is Studying the Feasibility of Producing a New

Multiple Choice

A manufacturing company is studying the feasibility of producing a new product. The selling price is expected to be $100. The new production line would manufacture up to 42,000 units at a variable cost of $67 per unit. Fixed costs would be $580,000. Variable selling and administration expenses would amount to $12. Determine operating income at 80% of capacity.

A) $124,700
B) $125,600
C) $126,500
D) $127,400
E) $128,300