Julia Industries produces cookware. The master budget called for production of 75,000 units this year. the budget at that level of producito follows:

Sales $1,200,000

Direct materials 300,000

Direct labor 150,000

Variable factory overhead 225,000

Fixed factory overhead 262,500

Fixed selling and admin exp 112,500

Operating Income $150,000

Due to the popularity of cooking shows on television, Julia industries now extimates sales will be 80,000 units. what is budgeted operating income at this level?

$230,000

$185,000

$167,000

$160,000