Sam's Bookstore Income Statement For Quarter Ended March 31

Sales $ 1,000,000

Cost of goods sold 665,000

Gross margin 335,000

Selling and administrative expenses Selling $ 107,000

Administrative 118,000 225,000

Net operating income $ 110,000

On average, a book sells for $50. Variable selling expenses are $4 per book with the remaining selling expenses being fixed. The variable administrative expenses are 3% of sales with the remainder being fixed. The cost formula for selling and administrative expenses with "X" equal to the number of books sold is:

multiple choice:

y = $140,000 + $4X

y = $140,000 + $5.5X

y = $115,000 + $5.5X

y = $115,000 + $7X