Marginal costing uses contribution at normal activity Steps:

• Selling price per batch $12 minus variable cost per batch$4 equals contribution per batch $8.
• Normal activity level is 1000 batches.
• Total contribution = $8 × 1000 =$8000.
• Under marginal costing, this represents the profit figure based on normal volume.

Why C is correct:

• Marginal costing profit equals total contribution at normal activity level, per standard volume-based planning formula.

Why the others are wrong:

• A: $6000 is actual sales revenue (500 ×$12), ignoring contribution.
• B: $7000 is normal sales minus total fixed costs ($12,000 - $5,000), mixing costing methods.

Final answer: C