Carr Company produces a single product. During the past year, Carr manufactured 30,030 units and sold 24,700 units. Production costs for the year were as follows:

Fixed manufacturing overhead	$420,420
Variable manufacturing overhead	$237,237
Direct labor	$126,126
Direct materials	$243,243

Sales totaled $1,272,050, variable selling expenses totaled $133,380, and fixed selling and administrative expenses totaled $195,195. There were no units in beginning inventory. Assume that direct labor is a variable cost.

Under variable costing, the net income for the year would be:

$28,249 higher than under absorption costing

$74,620 higher than under absorption costing

$74,620 lower than under absorption costing

$28,249 lower than under absorption costing