Great Outdoze Company manufactures sleeping bags, which sell for $66.10 each. The variable costs of production are as follows: Direct material Direct labor Variable manufacturing overhead $18.40 10.80 6.70 Budgeted fixed overhead in 20x1 was $160,800 and budgeted production was 24,000 sleeping bags. The year's actual production was 24,000 units, of which 20,600 were sold. Variable selling and administrative costs were $1.50 per unit sold; fixed selling and administrative costs were $23,000. Required: 1. Calculate the product cost per sleeping bag under (a) absorption costing and (b) variable costing. 2-a. 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.