During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales (@ $60 per unit) Cost of goods sold (@ $42 per unit) Gross margin Selling and administrative expenses* Net operating income Year 1 $ 1,020,000 714,000 306,000 299,000 $ 7,000 Year 2 $ 1,620,000 1,134,000 486,000 329,000 157,000 * $3 per unit variable; $248,000 fixed each year. The company's $42 unit product cost is computed as follows: $ 9 13 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead ($352,000 = 22,000 units) Absorption costing unit product cost 16 $ 42 Production and cost data for the first two years of operations are: Units produced Units sold Year 1 22,000 17,000 Year 2 22,000 27,000 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. X Answer is not complete. 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.) Year 1 Year 2 Net operating income |(loss) $ (48,000) X $ 299,000 X