Rainbow Company Is Considering the Production of a New Product

Multiple Choice

Rainbow Company is considering the production of a new product.Rainbow Company has the following data available:
$\begin{array}{ll}\text { Expected product life } & 5 \text { years } \\\text { Expected sales (units) over product life } & 2,000 \\\text { Variable production costs } & \$ 42 \text { per unit } \\\text { Variable selling costs } & \$ 16 \text { per unit } \\\text { Annual fixed production costs } & \$ 15,000 \\\text { Annual fixed selling costs } & \$ 5,000\end{array}$
What is the total fixed cost of the product over the product life cycle?

A) $20,000
B) $100,000
C) $116,000
D) $464,000