N Sparn Limited incurs the following costs to produce and sell a single product 13 Variable costs per unit: Direct materials $ 20 points Direct labour 10 Variable manufacturing overhead 4 Skipped Variable selling and administrative expenses 8 Fixed costs per year: Fixed manufacturing overhead 180,000 Fixed selling and administrative expenses 600,000 eBook Print During the last year, 30,000 units were produced and 22,500 units were sold. The Finished Goods Inventory account at the end of the References year shows a balance of $85,000 for the 2,500 unsold units. Required: 1-a. Is the company using absorption costing or variable costing to cost units in the Finished Goods Inventory account? Absorption costing O Variable costing 1-b. Show computations to support your answer. Variable Absorption Costing Costing Direct materials2 1-b. Show computations to support your answer. Variable Absorption Costing Costing 13 Direct materials points Direct labour Skipped Variable manufacturing overhead Fixed manufacturing overhead Unit product cost $ 0 $ eBook Total cost, 2,500 units Print References 2. Assume that the company wishes to prepare financial statements for the year to issue to its shareholders. a. Is the $85,000 figure for finished goods inventory the correct amount to use on these statements for external reporting purpose O Yes O NO2 2. Assume that the company wishes to prepare financial statements for the year to issue to its shareholders. 13 points a. Is the $85,000 figure for finished goods inventory the correct amount to use on these statements for external reporting purposes? Skipped O Yes eBook O No Print References b. At what dollar amount should the 2,500 units be carried in inventory for external reporting purposes? Inventory value for external reporting purposes