Answer:
c. $88,700
Explanation:
The computation of operating income for Winston Corporation is shown below:-
Particulars              Dropping before              Dropping after
Sales a                  $469,000                           $383,500
                                                                          ($295,000 × 130%)
Variable cost b     $181,000                              $131,300
($101,000 × 130%)
Contribution margin $288,000                          $252,200
(c = a - b)
Direct fixed cost d  $160,000                          $87,000
Segment margin e $128,000                           $165,200
(e = c - d)
Allocated common cost f $76,500                  $76,500
Operating income(loss) $51,500                      $88,700
(g = d - e)
Therefore to reach the operating income(loss) we simply deduct the allocated common cost from segment margin.