Travis Company reports the following for its single product. Travis produced and sold 26,000 units this year.

Direct materials	$ 36	per unit
Direct labor	$ 42	per unit
Variable overhead	$ 15	per unit
Fixed overhead	$ 126,000	per year
Variable selling and administrative expenses	$ 6	per unit
Fixed selling and administrative expenses	$ 201,600	per year
Sales price	$ 186	per unit

Compute contribution margin for the company under variable costing.

Multiple Choice

• $4,836,000

• $2,418,000

• $2,856,000

• $2,654,400

• $2,262,000