Figure 4-2

Figure 4-2. Pauley Company provides home health care.Pauley charges $35/hour for professional care.Variable costs are $21/hour and fixed costs are $78,000.Next year,Pauley expects to charge out 12,000 hours of home health care.
Refer to Figure 4-2.What is the budgeted operating income?

A) $342,000
B) $174,000
C) $168,000
D) $90,000
E) $420,000