During its first year of operations (beginning inventory was $0) in 2018, Lafayette Manufacturing, reported the following costs:

Direct materials................... $10 per unit

Direct labor......................... $7 per unit

Variable factory overhead.... $3 per unit

Fixed factory overhead........ $7000

Units produced this year....... 3,500 units

Units sold this year 3,000 units

Calculate the following items and write your answers in the spaces provided.

a. Which expense listed above is treated differently under the two methods?

How is this expense treated under variable costing? Write either Period Cost OR Product Cost.

b. Unit cost - absoprtion costing: $

c. Unit cost - variable costing: $

d. Cost of Goods Sold absorption costing: $

e. Cost of Goods Sold - variable costing: $

f. Units in Ending Inventory

g. Ending Inventory - absorption costing: $

h. Ending Inventory - variable costing: $

i. Given this information for Lafayette Manufacturing, Inc., which of the following income statements would report a higher amount for income from operations? Write either Absorption OR Variable: