Figure 8-1. Last year, Fabre Company produced 20,000 units and sold 18,000 units at a price of $12. Costs for last year were as follows: Direct materials $35,000 Direct labor 45,000 Variable factory overhead 22,000 Fixed factory overhead 47,000 Variable selling expense 8,000 Fixed selling expense 7,500 Fixed administrative expense 5,500 Fixed factory overhead is applied based on expected production. Last year, Fabre expected to produce 20,000 units.

1. Refer to Figure 8-1. Assuming that beginning inventory was zero, what is the value of ending inventory under absorption costing? 2. Refer to Figure 8-1. Assuming that beginning inventory was zero, what is the value of ending inventory under variable costing?3. Refer to Figure 8-1. What is operating income for last year under absorption costing?4. Refer to Figure 8-1. What is operating income for last year under variable costing?