ElectronPlus manufactures and sells a unique electronic part. Operating results for the first three years of activity were as follows (absorption costing basis) Year 1 Year 2 Year Sales $1,020,000 $016,000 $1,050,000 Cost of goods sold: Beginning inventory 0 284,000 Add: cost of goods manufactured 304,000 836.000 765,000 Goods available for sale 804,000 836,000 1.049,90 Less: ending inventory 284.000 186,600 Cost of goods sold 800,000 552,000 863,000 Gross margin 216,000 264,000 187,000 Selling and administrative expenses 169,000 123,000 195,000 Operating income (105) $ 47,000 $141,000 $ (8,000) Sales dropped by 20% during year 2 due to the entry of several foreign competitors into the market. ElectronPlus had expected sales to remain constant at 45.000 units for the year production was set at 55,000 units in order to build a buffer against unexpected spurts in demand, By the start of year 3, management could see that spurts in demand were unlikely and that the inventory was excessive. To work off the excessive inventories, ElectronPlus cut back production during year 3, as shown below Production in units Sales In units Year 1 45,000 45,000 Year 2 55,000 35,000 Year 3 35,000 45,000 Additional Information about the company follows: a. The company's plant is highly automated, Variable manufacturing costs (direct materials direct labour, and variable manufacturing overhead) total only $4 per unit, and fixed manufacturing overhead costs total $668,000 per year. b. Fixed manufacturing overhead costs are applied to units of product on the basis of each year's planned production. (That is, a new 2. Refer to the absorption costing income statements above. a. Compute the unit product cost in each year under absorption costing (Show how much of this cost is variable and how much is fixed) (Round your answer to 2 decimal places.) Year Year 2 Yoar 3 Variable manufacturing cost Fixed manufacturing cost Unit product cost $ 0.00 $ 0.00 $ 0.00 b. Reconcile the variable costing and absorption costing operating income figures for each year (Losses and deductible amounts should be indicated by a minus sign. Do not leave any empty spaces; Input a O wherever it is required. Round your intermediate calculations to 2 decimals and round your final answer to the nearest whole dollar.) Variable costing operating income (losa) Add (Deduct) Fixed manufacturing overhead cost deferred in Inventory from Year 2 to Year 3 unr absorption costing Add Fixed manufacturing overhead cost deferred in inventory from Year 3 to the future under absorption costing Absorption costing operating income (los) $ os ElectronPlus manufactures and sells a unique electronic part Operating results for the first three years of activity were as follows (absorption costing basis) Year 1 Year 2 Year $1,620,000 $416,000 $1,050,000 Sales Cost of goods sold: Beginning inventory Add: cost of goods manufactured Goods available for sale Less: ending inventory Cost of goods sold Gross margin Selling and administrative expenses Operating income (los) 0 284,000 304,000) 836.000 765,000 804,000 836,000 1.049, 284,000 186,000 800,000 552,000 863,000 216,000 264.000 187,000 169,000 125.000 195,000 47,000 $141,000 $ (8,000) $ Sales dropped by 20% during year 2 due to the entry of several foreign competitors into the market. ElectronPlus had expected sales to remain constant at 45.000 units for the year production was set at 55,000 units in order to build a buffer against unexpected spurts in demand, By the start of year 3, management could see that spurts in demand were unlikely and that the inventory was excessive. To work off the excessive inventories, ElectronPlus cut back production during year 3, as shown below. Production in units Sales In units Year 1 45,000 45,000 Year 2 55,000 35,000 Year 3 35,000 45,000 Additional information about the company follows a. The company's plant is highly automated Variable manufacturing costs (direct materials direct labour, and variable manufacturing overhead) total only $4 per unit, and fixed manufacturing overhead costs total $668,000 per year. b. Fixed manufacturing overhead costs are applied to units of product on the basis of each year's planned production. (That is, a new