Variable Costing versus Full Absorption Costing: Comparison of Operating Profit: Milton, Inc., produces a single product, which sells for $14.40. Milton produced 80.000 units and sold 72,000 units last year. There were no beginning or ending work in process inventories last year. Manufacturing costs and marketing and administrative costs for last year were as follows: 

Required:

a. Compute the unit product (manufacturing) cost, using variable costing.

b. What would Milton's operating profit be using variable costing?

c. What would operating profit be using full-absorption costing?

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Variable Fixed Direct materials $280,000 Direct labor 200,000 Manufacturing overhead 80,000 $180,000 Marketing and administrative costs 69.120 120,000