The following data was compiled for Hard-Rock Concrete Company:

Revenues 2011 2012
($53 per unit × 900,000 units; $56 per unit × 800,000 ) $47,700,000 $44,800,000
Costs
Direct Materials Costs
($2.30 per cm × 5,000,000; $2.38 per cm × 4,950,000 ) $11,500,000 $11,781,000
Conversion Costs
($4.90 × 6,550,000; $5.10 × 6,500,000 ) $32,095,000 $33,150,000
Total Costs $43,595,000 $44,931,000
Operating Income ? ?
Change in Operating Income $?

Required
Compute the operating income for 2011 and 2012. Next, compute the revenue effect in growth and indicate whether the growth in favorable, F, or unfavorable, U.
A) 2011=$3,960,000;2012=$236,000; $2,974,000 F
B) 2011=$2,856,000;2012=$1,360,000; $3,025,000 U
C) 2011=$4,105,000;2012=$131,000; $4,236,000 U
D) 2011=$3,241,000;2012=$126,000; $4,250,000 U
E) 2011=$3,025,000; 2012=$125,000; $4,250,000 F

C
Explanation: C)
2011 = [($47,700,000-$43,595,000 )] = $4,105,000
2012 = [$44,800,000-$44,931,000 )] = $(131,000 )
[($4,105,000 + ($131,000 U)] = ($4,236,000 )