Lilypad Hot Tubs, Inc. reports the following information for August: Sales Revenue $ 900 comma 000 Variable Costs 310 comma 000 Fixed Costs 56 comma 000 Calculate the operating income for August using variable costing. A. $ 590 comma 000 B. $ 900 comma 000 C. $ 844 comma 000 D. $ 534 comma 000

Net operating income = $534,000

Explanation:

The net operating income is the result of subtracting the total variable costs and total fixed costs to the sales revenue:

Income Statement:

Sales Revenue = $900,000

Variable Costs = (310,000)

Contribution margin = 590,000

Fixed Costs = (56,000)

Net operating income = $534,000