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During Heaton Companys first two years of operations, it reported absorption costing net operating income as follows: Year 1 Year 2 Sales ( @ $
During Heaton Companys first two years of operations, it reported absorption costing net operating income as follows: Year Year Sales @ $ per unit$ $ Cost of goods sold @ $ per unitGross marginSelling and administrative expensesNet operating income$ $ $ per unit variable; $ fixed each year.The companys $ unit product cost is computed as follows:Direct materials$ Direct laborVariable manufacturing overheadFixed manufacturing overhead $: unitsAbsorption costing unit product cost$ Production and cost data for the first two years of operations are: Year Year Units producedUnits soldRequired:Using variable costing, what is the unit product cost for both years?What is the variable costing net operating income in Year and in Year Reconcile the absorption costing and the variable costing net operating income figures for each year.
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