For 2013, Winchester Company sold 80,000 units at a selling price of $20 per unit. Variable cost per unit was $15, and Winchester's net income for the year was $40,000. What was the amount of Winchester's fixed costs?

$360,000

$440,000

$1,160,000

$400,000

Harris Company produces a product whose cost is $10. Assuming the company uses a cost-plus pricing system, what selling price would the company set to earn a profit margin of 20% of cost?

$2.00

$12.50

$50.00

$12.00