ce Tami Tyler opened Tom's Creations, Incorporated, a small manufacturing company, at the beginning of the year. Getting the company through its first quarter of operations placed a considerable strain on Ms. Tyler's personal finances. The following income statement for the first quarter was prepared by a friend who has just completed a course in managerial accounting at State University Tamsta Creations, Incorporated Income Statement Tor the Quarter Ended March 31 Sales (20,000 units) $1.152,000 Variable expenses Variable cost of goods sold $434.000 Variable selling and administrative 122.000 602,680 Contribution sargin 540,320 Fixed expenses Tixed manufacturing overhead 206.200 Tixed selling and administrative 271,620 552.920 Bet operating loan 13,500) Ms. Tyler is discouraged over the loss shown for the quarter, particularly because she had planned to use the statement as support for a bank loan. Another friend, a CPA, insists that the company should be using absorption costing rather than variable costing and argues that if absorption costing had been used the company probably would have reported at least some profit for the quarter At this point, Ms. Tyleris manufacturing only one product-a swimsuit Production and cost data relating to the swimsuit for the first Quarter follow: 31000 20.000 Units produced United Variable costs per Direct natecials Direct labor Variable soutacturing overed Variable and admirati $7.30 S500 11.10 4.00 Required: 1. Complete the following: a. Compute the unit product cost under absorption costing b. What is the company's absorption costing net operating income (loss) for the quarter? c. Reconcile the variable and absorption costing net operating income foss) figures 3. During the second quarter of operations, the company again produced 21,800 units but sold 34,800 units. (Assume no change in total fixed costs) a. What is the company's variable costing net operating income (los) for the second quarter? b. What is the company's absorption costing net operating income (loss) for the second quarter? c. Reconcile the variable costing and absorption costing net operating incomes for the second quarter