Zurgot Inc. has just organized a new division to manufacture and sell specially designed computer tables, using select hardwoods. The division’s monthly costs are shown in the schedule below:

Manufacturing Costs
Variable Costs per unit
Direct Materials	$152
Variable manufacturing overhead	$10
Fixed manufacturing overhead costs	$340,000
Selling and Administrative costs
Variable	%15 of sales
Fixed	$160,000

Zurgot regards all of its workers as full-time employees and the company has a long-standing no-layoff policy. Furthermore, production is highly automated. Accordingly, the company includes its labour costs in its fixed manufacturing overhead. The tables sell for $400 each.

During the first month of operations, the following activity was recorded.

Units Produced 4,000

Units Sold 3,200

Reconcile the absorption costing and variable costing operating income as per above.