Casey Operating Income Under Variable Costing 547796

The information below is for Casey Corporation.

Product sales: 1,000 units at $10 each
Variable manufacturing costs: $5.50 per unit
Fixed manufacturing overhead: $1,200
Variable selling and administrative costs: $.50 per unit sold
Fixed selling and administrative costs: $1,000
No beginning inventory
Units produced: 1,200

Casey’s operating income under variable (direct) costing is

A. $700

B. $2,300

C. $1,800

D. $600