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Krepps Corporation produces a single product. Last year, Krepps manufactured 33,110 units and sold 27.600 units. Production costs for the year were as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead $ 248,325 $ 175,483 $ 294,679 $ 463,540 Sales totaled $1,242,000 for the year, variable selling and administrative expenses totaled $140,760, and fixed selling and administrative expenses totaled $221,837. 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: $30,305 higher than under absorption costing. $77,140 higher than under absorption costing. $30,305 lower than under absorption costing. $77,140 lower than under absorption costing. Krepps Corporation produces a single product. Last year, Krepps manufactured 33,110 units and sold 27.600 units. Production costs for the year were as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead $ 248,325 $ 175,483 $ 294,679 $ 463,540 Sales totaled $1,242,000 for the year, variable selling and administrative expenses totaled $140,760, and fixed selling and administrative expenses totaled $221,837. 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