Lincoln Lodging Inc

Multiple Choice

Lincoln Lodging Inc.estimates that if its sales increase 10.00% then its net income will increase 14.50%.The company's EBIT equals $2.4 million,and its interest expense is $400,000.The company's operating costs include fixed and variable costs.What is the level of the company's fixed operating costs? Do not round your intermediate calculations.

A) $480,000
B) $455,000
C) $400,000
D) $500,000
E) $420,000