28.

DeAnne Company produces a single product. The company's variable costing income statement for the month August appears below:

De Anne Company Income Statement For the month ending August 31
Sales ($21 per unit)	$854,700
Variable expenses:
Variable cost of goods sold	488,400
Variable selling expense	122,100
Total variable expenses	610,500
Contribution margin	244,200
Fixed expenses:
Fixed manufacturing	140,800
Fixed selling and administrative	70,400
Total fixed expenses	211,200
Net operating income	$ 33,000

The company produced 35,200 units in August and the beginning inventory consisted of 8,750 units. Variable production costs per unit and total fixed costs have remained constant over the past several months.

Under absorption costing, for August the company would report a:

	$70,400 profit
	$11,000 profit
	$11,000 loss
	$33,000 profit Which is correct, please show work.