Fire Strom is a manufacturing of quality fireplace inserts for the residential home market. the following information pertains to fire strom's top of the line peninsula fireplace. Fire Strom had no beninning inventory for this item.

Production in units 3000

Sales in Units 2700

Unit selling price $1400

Fabrication hours used 45000 Hours

Direct labours used 3000 hours

Manufacuring costs :

Direct materials $2100000

Direct Labour $120000

Variable manufacturing overheader $75000

Fixed manufacturing over head $600000

Non Manufacuring costs :

Variable selling expenses $210000

Fixed Selling expenses $250000

Other fixed administrative Costs $700000

Question

1. Determine the unit product cost of a Firestrom Peninsula fireplace using variable costing

2. Determine the cost of goods sold using absorption costing

3. Determine the dollar difference in income(if any) using variable versus absorption costing and report which menthod will report higher income if appropriate.