Crystal Corporation produces a single product. The company's variable costing income statement for the month of May appears below:

Crystal Corporation Income Statement For the month ended May 31
Sales ($22 per unit)	$3,025,000
Variable expenses:
Variable cost of goods sold	1,925,000
Variable selling expense	412,500
Total variable expenses	2,337,500
Contribution margin	687,500
Fixed expenses:
Fixed manufacturing overhead	420,000
Fixed selling and administrative	137,500
Total fixed expenses	557,500
Net operating income	$130,000

The company produced 105,000 units in May and the beginning inventory consisted of 65,000 units. Variable production costs per unit and total fixed costs have remained constant over the past several months. Under absorption costing, for May the company would report a:

$260,000 profit

$130,000 loss

$130,000 profit

$0 profit