Ida Sidha Karya Company is a family-owned company located on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $950. Selected data for the companys operations last year follow:

Units in beginning inventory		0
Units produced		270
Units sold		235
Units in ending inventory		35
Variable costs per unit:
Direct materials	$	110
Direct labor	$	330
Variable manufacturing overhead	$	30
Variable selling and administrative	$	20
Fixed costs:
Fixed manufacturing overhead	$	81,000
Fixed selling and administrative	$	22,000

The absorption costing income statement prepared by the companys accountant for last year appears below:

Sales	$	223,250
Cost of goods sold		180,950
Gross margin		42,300
Selling and administrative expense		26,700
Net operating income	$	15,600

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.