Roberts Corp

Multiple Choice

Roberts Corp., which began business at the start of the current year, had the following data:
Planned and actual production: 40,000 units
Sales: 37,000 units at $15 per unit
Production costs:
Variable: $4 per unit
Fixed: $260,000
Selling and administrative costs:
Variable: $1 per unit
Fixed: $32,000
The gross margin that the company would disclose on an absorption-costing income statement is:

A) $97,500.
B) $147,000.
C) $166,500.
D) $370,000.
E) None of the other answers are correct.