10. A company produces a single product. Last year, fixed manufacturing overhead was $30,000, variable production costs were $48,000, fixed selling and administration costs were $20,000, and variable selling expenses were $9,600. There was no beginning inventory. During the year, 3,000 units were produced and 2,400 units were sold at a price of $40 per unit.

Under variable costing, contribution margin would be:

A. $52,800

B. $48,000

C. $49,920

D. $57,600

Under variable costing, net operating income (loss) would be:

A. A profit of $4,000

B. A loss of $80

C. A profit of $2,000

D. A loss of $2,000

Under absorption costing, gross margin would be:

A. $33,600

B. $27,600

C. $49,920

D. $57,600

Under absorption costing, net operating income (loss) would be:

A. A profit of $4,000

B. A profit of $8,920

C. A profit of $2,120

D. A loss of $2,000