XYZ Company provided the following cost information for last year when

they produced and sold 125,000 units:

direct materials ......................... $200,000

direct labor ............................. 100,000

manufacturing overhead ................... 180,000

selling and administrative expenses ...... 150,000

All costs are variable except for $100,000 of manufacturing overhead and

$60,000 of the selling and administrative expenses. Assume the selling

price is $10 per unit.

Calculate the amount of net income XYZ Company would report from producing

and selling 150,000 units.