Krepps Corporation produces a single product. Last year, Krepps manufactured 25,000 units and sold 20,000 units. Production costs for the year were as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead $180,000 $120,000 $210,000 $250,000 Sales totaled $850,000 for the year, variable selling and administrative expenses totaled $110,000, and fixed selling and administrative expenses totaled $170,000. There was no beginning inventory. Assume that direct labor is a variable cost. Under variable costing, the company's net operating income for the year would be: Multiple Choice $50,000 higher than under absorption costing. $50,000 lower than under absorption costing. O $28,000 lower than under absorption costing. $28,000 higher than under absorption costing