Statement (1) and (2) are contradicting to me!

From statement 1, I get that 40 customers did not buy chocolate pie-- so I take that to mean that 40 customers did the opposite which is to buy coconut.

However, statement 2 directly states that 120 customers bought coconut.

1-- Both: 80 Coconut: 40 Chocolate: 80
2-- Both: 80 Coconut: 120 Chocolate: 0

Please explain. Thank you!

200 pies total
80 customers bought both c + b
We don't know total number of customers, though - as some customers bought one pie, and some bought two pies.
We want to know how many chocolate pies he sold. (Don't confuse this with the number of customers.)

(1) 40 did not buy a chocolate pie -- in other words, 40 customers bought a single coconut pie.
We know that 80 customers bought both, so this is 160 more pies, bringing our total to 200. This is sufficient to answer the question.

(2)
120 customers bought a coconut pie. (This includes both customers who bought only coconut and customers who bought both.)
80 customers bought both -- so 40 bought only coconut.
Again, we're back at the same information as in statement 1, which was sufficient. so our answer is D.

Veritas Help