During its first year of operations, the EC Company incurred the following costs:

Variable Costs:	Per Unit	Product
Direct Materials	$5	$5
Direct Labor	$3	$3
Variable Factory Overhead	$2	$2
Variable SG&A	$1
Fixed Costs:		20,000	25,000
Fixed Factory Overhead	200,000	$10	$8
Fixed SG&A	300,000	$15	$12
Total Fixed Costs	500,000

The company produced 25,000 units, and sold 20,000 units at $100 each, leaving 5,000 units in inventory at year-end. What is EC's Operating Profit for the year using variable costing?

During its first year of operations, the EC Company incurred the following costs:

Variable Costs:	Per Unit	Product
Direct Materials	$5	$5
Direct Labor	$3	$3
Variable Factory Overhead	$2	$2
Variable SG&A	$1
Fixed Costs:		20,000	25,000
Fixed Factory Overhead	200,000	$10	$8
Fixed SG&A	300,000	$15	$12
Total Fixed Costs	500,000

The company produced 25,000 units, and sold 20,000 units at $100 each, leaving 5,000 units in inventory at year-end. What is EC's Operating Profit for the year using variable costing?

1,280,000

1,320,000

1,220,000

1,380,000

1,640,000

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