Lincoln Lodging Inc

Multiple Choice

Lincoln Lodging Inc.estimates that if its sales increase 10% then its net income will increase 18%.The company's EBIT equals $2.4 million,and its interest expense is $400,000.The company's operating costs include fixed and variable costs.What is the level of the company's fixed operating costs?

A) $1,083,000
B) $1,140,000
C) $1,200,000
D) $1,260,000
E) $1,323,000