Tustin Corporation has provided the following data for its two most recent years of operation: Selling price per unit$68 Manufacturing costs: Variable manufacturing cost per unit produced: Direct materials$10Direct labor$6Variable manufacturing overhead$4Fixed manufacturing overhead per year$220,000Selling and administrative expenses: Variable selling and administrative expense per unit sold$6Fixed selling and administrative expense per year$61,000 Year 1Year 2Units in beginning inventory01,000Units produced during the year11,00010,000Units sold during the year10,0007,000Units in ending inventory1,0004,000The net operating income (loss) under variable costing in Year 1 is closest to:
A. $159,000
B. $480,000
C. $420,000
D. $139,000
Answer: D
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