Last year, Fabre Company produced 20,000 units and sold 18,000 units at a price of $12.

Costs for last year were as follows:

Direct materials-$25,000

Direct labor-35,000

Variable factory overhead-12,000

Fixed factory overhead-37,000

Variable selling expense-9,000

Fixed selling expense-7,500

Fixed administrative expense-15,500

Fixed factory overhead is applied based on expected production. Last year, Fabre expected to produce 20,000 units.

What is operating income for last year under variable costing?

A. $111,800

B. $91,780

C. $82,200

D. $78,400

E. $66,350