Altoona Valve Companys planned production for the year just ended was 18,800 units. This production level was achieved, and 21,000 units were sold. Other data follow:

Direct material used	$	575,280
Direct labor incurred		272,600
Fixed manufacturing overhead		404,200
Variable manufacturing overhead		206,800
Fixed selling and administrative expenses		325,240
Variable selling and administrative expenses		91,180
Finished-goods inventory, January 1		2,700	units

The cost per unit remained the same in the current year as in the previous year. There were no work-in-process inventories at the beginning or end of the year.

Required:

1.	What would be Altoona Valve Companys finished-goods inventory cost on December 31 under the variable-costing method? (Do not round your intermediate calculations.)

2-a.

Which costing method, absorption or variable costing, would show a higher operating income for the year?

	Absorption costing
	Variable costing

2-b.	By what amount? (Do not round your intermediate calculations.)