During 2021 Snow produced 70,000 units and sold 65,000 units at a price of $150 per unit. Fixed factory overhead is applied based on production. Beginning inventory is zero(0). Costs for last year were as follows:

1. What is the cost of ending inventory on the balance sheet if Snow is using absorption costing?

2. What is the cost of ending inventory on the balance sheet if Snow is using variable costing?

3. Determine income for Snow. Assume Snow is using absorption costing. Show workings. You do have to prepare an income statement

4. Calculate net income for Snow. Assume Snow is using variable costing. Show workings. You do have to prepare an income statement(7

Variable costs per unit
Direct materials	$60
Direct labour	$25
Variable overhead	$7
Variable selling	$15
Fixed costs
Manufacturing cost	$840,000
Selling and administration	$340,000