The problem below has Multiple Choice options. Please show your work. Thank you.

Favaz began business at the start of this year and had the following costs: variable manufacturing cost per unit, $7; fixed manufacturing costs, $60,000; variable selling and administrative costs per unit, $1; and fixed selling and administrative costs, $254,000. The company sells its units for $50 each. Additional data follow.

Planned production in units 10,000

Actual production in units 10,000

Number of units sold 8,000

There werenovariances.

The income (loss) under absorption costing is:

Multiple Choice

• $22,000.
• $(7,000).
• $34,000.
• $31,000.
• None of the answers is correct.
• Incorrect