The Brewing Company manufactures a single product; the standard costs per unit being variable manufacturing $8, fixed manufacturing $6. Selling and administrative costs are $2 per unit sold. The selling price is $20 per unit. Actual and budgeted fixed overhead is $900 000 for the year. Information about Brewings production activity for the year is

Sales 125 000 units

Units produced 150 000 units

Units sold 5000 units

What is the profit under absorption costing?

Select one:

$1 250 000

Insufficient information to determine

$750 000

$500 000

$350 000