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

Fixed manufacturing overhead cost included in inventory = ???

2. Prepare an income statement for last year using variable costing.