Great Outdoze Company manufactures sleeping bags, which sell for $65.40 each. The variable costs of production are as follows: Direct material $19.90 Direct labor 10.40 Variable manufacturing overhead 6 .70 Budgeted xed overhead in 20x1 was $194,400 and budgeted production was 27,000 sleeping bags. The year's actual production was 27,000 units. of which 24,200 were sold. Variable selling and administrative costs were $1.40 per unit sold; xed selling and administrative costs were $24,000. Required: 1. Calculate the product cost per sleeping bag under (a) absorption costing and (b) variable costing. 2-5. Prepare an operating income statement for the year using absorption costing. 2-b. Prepare an operating income statement for the year using variable costing. 3. Reconcile reported operating income under the two methods using the shortcut method