Exercise 8-23 Absorption and Variable Costing (LO 8-1,8-4) Pandora Pillow Company's planned production for the year just ended was 21,600 units. This production level was achieved, but only 18,400 units were sold, Other data follow: Direct material uned Direct labor incurred Fixed manufacturing overhead Variable manufacturing overhead Tixed selling and administrative expenses Variable selling and administrative expenses Finished-goods inventory, January 1 5645,840 320,320 434, 160 218. 160 390,960 124, 200 None The cost per une remained the same in the current year as in the previous year. There were no work in process inventories at the beginning or end of the year Required: 1. What would be Pandora Pillow Company's finished goods Inventory cost on December 31 under the variable-costing method? (D. not round Intermediate calculations.) 2-a. Which costing method, absorption or varioble costing, would show a higher operating income for the year? 2-b. By what amount? (Do not round Intermediate calculations.) 1 Finished-goods inventory cou 2.0 Higher operating income method 2. Difference in reported income