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

Planned and actual production: 40,000 units

Sales: 35,000 units at $17 per unit

Production costs:

Variable: $3 per unit

Fixed: $275,000

Selling and administrative costs:

Variable: $1 per unit

Fixed: $41,700

The gross margin that the company would disclose on an absorption-costing income statement is:

Multiple Choice

• $180,375.
• $215,000.
• $249,375.
• $455,000.
• None of the answers is correct.