\fIda Company produces a handcrafted musical Instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $900. Selected data for the company's operations last year follow: Units in beginning inventory Units produced Units sold 275 Units in ending inventory 25 Variable costs per unit: Direct materials $ 125 Direct labor $ 345 Variable manufacturing overhead $ 45 Variable selling and administrative $ 35 Fixed costs: Fixed manufacturing overhead $ 63, 090 Fixed selling and administrative $ 25,090 The absorption costing Income statement prepared by the company's accountant for last year appears below: Sales $ 247, 508 Cost of goods sold 199,375 Gross margin 48, 125 Selling and administrative expense 34, 625 Net operating income $ 13, 508 Required: 1. Under absorption costing, how much fixed manufacturing overhead cost is Included In the company's Inventory at the end of last year? 2. Prepare an Income statement for last year using variable costing. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Under absorption costing, how much fixed manufacturing overhead cost is included in the company's inventory at the end of last year? Fixed manufacturing overhead cost included in inventoryRequired Information [The following information applies to the questions displayed below.] Jorgansen Lighting, Incorporated, manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for Internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data: Year 1 Year 2 Year 3 Inventories Beginning (units) 208 179 289 Ending (units) 178 200 230 Variable costing net operating income $ 290, 090 $ 279, 090 $ 260, 980 The company's fixed manufacturing overhead per unit was constant at $570 for all three years. Required: 1. Calculate each year's absorption costing net operating Income. (Enter any losses or deductions as a negative value.) Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Year 1 Year 2 Year 3 Variable costing net operating income Add (deduct) fixed manufacturing overhead deferred in (released from) inventory under absorption costing Absorption costing net operating incomeRequired Information [The following Information applies to the questions displayed below.] Jorgansen Lighting, Incorporated, manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for Internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data: Year 1 Year 2 Year 3 Inventories Beginning (units) 179 280 Ending (units) 178 289 230 Variable costing net operating income $ 290, 808 $ 279, 890 $ 260, 080 The company's fixed manufacturing overhead per unit was constant at $570 for all three years. 2. Assume In Year 4 that the company's variable costing net operating income was $250,000 and its absorption costing net operating Income was $300,000. a. Did Inventories Increase or decrease during Year 4? O Increase O Decrease b. How much fixed manufacturing overhead cost was deferred or released from Inventory during Year 4? Fixed manufacturing overhead cost inventory during Year 4