During Heaton Company's first two years of operations: it repOIted absorption costing net operating income as follows: Year 1 Year 2 Sales [6 $61 per unit) $ 1,159,666 $ 1,766,666 Cost of goods sold {@ $36 per unit} 684,666 1,644,666 Gross margin 475,666 725,666 Selling and administrative expenses* 363,666 333,666 Net operating income $ 172,999 $ 392,399 * $3 per unit variable; $246,000 fixed each year. The companyis $36 unit product cost is computed as follows: Direct materials 3 8 Direct labor 11 Variable manufacturing overhead 5 Fixed manufacturing overhead ($288,666 + 24,666 units) 12 4bsorption costing unit product cost $ 35 Production and cost data for the first two years of operations are: Year 1 Year 2 Units produced 24,666 24,666 Units sold 19,666 29,666 Required: 1. Using variable costing, what Is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year. 9 Answer is complete but not entirely correct. 9 Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using variable costing, what is the unit product cost For both years? Unit productoost l$ 24o| 9 Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the variable costing net operating income in Year 1 and in Year 2? (Loss amounts should be indicated with a minus Sign.) Net operating income oss) $ 400.0009 0 T400009 X Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Reconcile the absorption costing and the variable costing net operating income figures for each year. Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Year 1 Year 2 Variable costing net operating income (loss) $ 400,000 * $ 740,000 X Add (deduct) fixed manufacturing overhead deferred in (released from) inventory under absorption costing 228,000 X 348,000 X Absorption costing net operating income $ 172,000 $ 392,000 V