Taylor Ltd Just Finished Its Second Year of Operations

Multiple Choice

Taylor Ltd just finished its second year of operations. In the first year it produced 1,000 units and sold 400. The second year resulted in the same production level, but sales were 1,200 units. The variable costing income statements for both years are shown below: The operating profit for year 1 using absorption costing would be

A) $6,000
B) $(9,000)
C) $(9,800)
D) $600