McArthur Corp., which began business at the start of the current year, had the following data:

Planned and actual production: 40,000 units

Sales: 38,000 units at $15 per unit = $570,000

Production costs:

Variable: $5 per unit = $190,000

Fixed: $260,000 @ 40,000 -> (260/40)*38 = @ 247,000 @38,000

Selling and administrative costs:

Variable: $1 per unit

Fixed: $32,000