Jorgansen Lighting, Inc., manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data Year 1 Year 2 160 $279,000 Year 3 Inventories Beginning (units) Ending (units) 210 160 $300,000 190 230 $250,000 Variable costing net operating income The company's fixed manufacturing overhead per unit was constant at $560 for al three years Required: 1. Calculate each year's absorption costing net operating income. (Enter any losses or deductions as a negative value.) Answer is complete but not entirely correct. Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes Year 1 Year 2 Year 3 Variable costing net operating income Add (deduct) fixed manufacturing overhead deferred in (released from) inventory under absorption costin $ 300,000 279,000 250,000 22,400 $ 227,600 (28,000) 16,800 Absorption costing net operating income $ 272,000 $ 295,800 Pre f5: Next >