Luanna Inc. manufactures game consoles. Some of the company's data was misplaced. Use the following information to replace the lost data.

ActualResults Flexible BudgetVariance FlexibleBudget SalesVolumeVariance MasterBudgetUnits 1,760 1,700 Revenues$103,840 $1,760U A B Variable costs C $47,600 Fixed costs$20,700 Operating income$44,350 D $25,000

The amount D (to the nearest dollar) is:

$26,920

1. Master budget sales ? master budget variable costs ? master budget fixed costs = master budget operating income = $102,000 ? $47,600 ? X = $25,000; therefore, budgeted fixed costs = $29,400.

2. Fixed costs in the flexible budget (FB) = Fixed costs in the master budget (MB) = $29,400 (see (1) above).
3. Budgeted variable cost/unit = MB variable costs/MB sales volume = $47,600/1,700 units = $28.00.

4. Variable costs in the FB = actual sales volume × budgeted variable cost per unit = 1,760 units × $28.00/unit = $49,280.

5. FB operating income = FB sales ? FB variable costs ? FB fixed costs = $105,600 ? $49,280 ? $29,400 = $26,920 (to the nearest dollar)