During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows Year 1 Sales (@ $60 per unit) $ 1,140,000 Cost of goods sold (@ $42 per unit) 798,000 Gross margin 342,000 Selling and administrative expenses 306,800 Net operating income $ 35,000 *$3 per unit variable: $249.000 fixed each year. The company's $42 unit product cost is computed as follows: Year 2 $ 1,740,000 1,218,000 522,000 336 , $ 186,000 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead (5432,000 + 24,800 units) Absorption costing unit product cost $9 12 3 18 $ 42 Production and cost data for the first two years of operations are: Units produced Units sold Year 1 24,000 19,000 Year 2 24,000 29,000 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