P9-41 (similar to) Question Help Earth's Best Light (EBL), a producer of energy-efficient light bulbs, expects that demand will increase markedly over the next decade. Due to the high fived costs involved in the business, EBL has decided to evaluate its financial performance using absorption costing incins. The production volume variance is written off to cost of goods sold. The variable cost of production is $250 per bulb Fixed manufacturing costs are $1,170,000 por ar Variable and forced selling and administrative expenses are 50 35 per bulb sold and S270,000, respectively. Because its light bulbs are currently popular wil environmentally conscious customers, EBL can sell the bulbs for $9.70 each EBL is deciding among various concepts of capacity for calculating the cost of each unit produced. Its choices are as follows: (Click the icon to view the capacity information) Read the requirements Requirement 3. Assume EBL has no beginning inventory. If this year's actual sales are 225,000 bulbs (and production in 300,000 bulbo), calculate operating income for EBL using each type of capacity to compute fixed manufacturing cost per unit. Calculate the operating income for each type of capacity. We will do the operating income calculations one at a time, beginning with theoretical Label each variance as favorable (F) or unfavorable (U). Theoretical Revenge Less: Cost of goods sold Production.volume variance U Gros matgin Variable selling Fixed selling Operating income Theoretical capacity 900.000 bulbs Practical capacity 520.000 bulbs Normal capacity 260,000 bulbs (average expected output for the next 3 years) Master-budget capacity 225.000 bulbs expected production this year inde 1. Calculate the inventoriable cost per unit using each level of capacity to compute fixed manufacturing cost per unit 2. Suppose EBL actually produces 300.000 bulbs Calculate the production-volume variance using each level of capacity to compute the fixed manufacturing overhead allocation rate 3. Assume EBL has no beginning inventory. If this year's actual sales are 225.000 bulbs (and production is 300,000 bulbs), calculate operating income for EBL using each type of capacity to compute fixed manufacturing cost per