Absorption vs. Variable Costing Assignment (PART TWO) B Company Beginning inventory is 4,000 units All rates were the same in the previous year. Sales Production BUDGETED: 60,000 units [at $50 per unit] 75,000 units Variable mfg. cost $20 per unit [DM-$8; DL-$7; Var. mfg. overhead-$5] $10 per unit [based on planned prod. of 75,000 units] $3 per unit [based on units sold] Fixed mfg. cost Var. S&A cost Fixed S&A cost Sales Production $2 per unit [based on planned sales of 60,000 units] ACTUAL: 58,000 units @ $50 65,000 units There were no efficiency variances. There were no fixed S&A spending variances. We spent the same as budgeted. There was $50,000 F in material, labour and variable overhead spending variances. There was a $20,000 unfavourable fixed overhead spending variance. Fixed overhead denominator variance must be calculated. REQUIRED: Make an excel spreadsheet, using cell references wherever possible, that will allow a user to enter the above numbers and.... 1) 2) 3) Compute net income using Absorption costing. Compute net income using Variable (direct) costing. Reconcile the difference in net income.