Question 1 (35 marks) (A) Morey Company has just completed its first year of operations. The company's absorption costing income statement for the year appears below: Morey Company Income Statement Sales (40,000 units @ $33.75).. Cost of goods sold: Beginning inventory... Add cost of goods manufactured (50,000 units @$21)...... Goods available for sale... Less ending inventory (10,000 units @$21).. Gross Margin......... Selling and administrative expenses.. Net operating income..... $1,350,000 S 1.050.000 1,050,000 210.000 $40,000 $10,000 420,000 $ 90,000