Steve Harvey Company Uses Absorption Costing and Reports the Following

Multiple Choice

Steve Harvey Company uses absorption costing and reports the following information:
Variances
$\begin{array} { l } \text {Production Volume Variance }& \text {\( \$ 70,000 \) Unfavorable }\\ \text {Flexible Budget Variance for Fixed Factory Overhead }& \text { \( \$ 100,000 \) Unfavorable}\\ \text {Flexible Budget Variance for Variable Overhead }& \text { \( \$ 40,000 \) Favorable}\\ \text {Flexible Budget Variance for Direct Materials }& \text { \( \$ 20,000 \) Favorable}\\\end{array}$

Before consideration of the above variances,the company has operating income of $1,500,000.What is the operating income after considering the above variances?

A) $1,330,000
B) $1,390,000
C) $1,400,000
D) $1,560,000