Fresh Air Products manufactures and sells a variety of camping products. Recently the company opened a new plant to manufacture a deluxe portable cooking unit. Cost and sales data for the first month of operations are shown below:

Beginning inventory 0 units

Units produced 10,000

Units sold 9,000

Manufacturing costs

Fixed overhead $89,100

Variable overhead $3 per unit

Direct labour $9 per unit

Direct material $25 per unit

Selling and administrative costs

Fixed $190,000

Variable $3 per unit sold

The portable cooking unit sells for $110. Management is interested in the opening month's results and has asked for an income statement.

Assume the company uses normal costing and uses the budgeted volume of 13,500 units to allocate the fixed overhead rate rather than the actual production volume of 10,000 units. The company expenses production volume variance to cost of goods sold in the accounting period in which it occurs.

Question: Reconcile the difference in net income between the absorption-costing and normal-costing methods.

Normal costing operating income $357500 (calculated)

Costs deferred in ending inventory _______________

Absorption costing operating income $ _______________