..oo Sprint 00 Sprint 21:47 * 31% [ + Mgr-Acct.Ch 6 6.66 points During Heaton Company's first two years of operations, the company reported absorption costing net operating income as follows: Sales (@ $61 per unit) Cost of goods sold (@ $32 per unit) 1037,000 1,647000 864,000 544,000 493.000 783,000 Gross margn Selling and administrative expenses Net operating income 192,000 $ 452,000 $3 per unit variable; $250,000 fixed each year The company's $32 unit product cost is computed as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead 16 ($352,000+22,000 units) Absorption costing unit product cost 32 Forty percent of fixed manufacturing overhead consists of wages and salaries; the remainder consists of depreciation charges on production equipment and buildings. Production and cost data for the two years are: Units produced Units sold 22.000 22000 7,000 27000 Required: 1 Prepare a variable costing contribution format income statement for each year