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 ($38 per unit) Gross margin Selling and administrative expenses Net operating income Year 1 1,140,000 722,000 418,000 386,00 226,000 Year 2 1,740,000 1,102,000 638,000 336,000 476,000 *$3 per unit variable: $249,000 fixed each year, The company's $38 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead (5480,000 Absorption costing unit product cost 24,000 units) Forty percent of fixed manufacturing overhead consists of wages and salaries, the remainder consists of depreciation charges on production equipment and buildings. Production and cost data for the first two years of operations are: Year 1 24,000 19,000 a Year 2 24,000 Units produced Units sold s 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 22 3. Reconcile the absorption costing and the variable costing net operating income figures for each year