Fallow Corporation Has Two Separate Profit Centers

Multiple Choice

Fallow Corporation has two separate profit centers. The following information is available for the most recent year: The West Division occupies 5,000 square feet in the plant. The East Division occupies 3,000 square feet. Rent, which was $40,000 for the year, is an indirect expense and is allocated based on square footage. Compute operating income for the West Division.

A) $120,000.
B) $95,000.
C) $94,000.
D) $69,000.
E) $54,000.