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Ida Company produces a handcrafted musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $ 8 8 0

Ida Company produces a handcrafted musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $880. Selected data for the companys operations last year follow:
Units in beginning inventory 0
Units produced 280
Units sold 255
Units in ending inventory 25
Variable costs per unit:
Direct materials $ 105
Direct labor $ 315
Variable manufacturing overhead $ 35
Variable selling and administrative $ 40
Fixed costs:
Fixed manufacturing overhead $ 63,000
Fixed selling and administrative $ 32,000
The absorption costing income statement prepared by the companys accountant for last year appears below:
Sales $ 224,400
Cost of goods sold 173,400
Gross margin 51,000
Selling and administrative expense 42,200
Net operating income $ 8,800
Required:
1. Under absorption costing, how much fixed manufacturing overhead cost is included in the company's inventory at the end of last year?
2. Prepare an income statement for last year using variable costing.

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