Jamba Company makes ceramic mugs and has the following costs for 2018:

Selling price	$8.00 / mug
Variable production cost	$2.20 / mug
Variable selling cost	$0.40 / mug
Fixed production cost	$360,000 / year
Fixed selling and administrative cost	$80,000 / year

Production and sales in units for 2018 are as follows:

Production	Sales
100,000	90,000

What would operating income be for 2019 using variable costing?

• A.

  $24,000

• B.

  $82,000

• C.

  $486,000

• D.

  $46,000