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Question 5 (12 marks) The Miller Company had the following information for its first two years of operation In Year 1, the company produced and

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Question 5 (12 marks) The Miller Company had the following information for its first two years of operation In Year 1, the company produced and sold 40,000 units of its only product in Year 2, the company again sold 40,000 units, but increased production to 50,000 units. The selling price per unit is $30. The company's variable production cost is $5 per unit each year, and its foxed manufacturing overhead cost is $600,000 each year, Per unit fixed manufacturing overhead costs are applied at year end to the product on the basis of each year's unit production Variable selling and administrative expenses are $2 per unit sold. Fixed selling and administrative expenses are $220,000 each year Required: a) Compute the unit product cost for each year under absorption costing and under variable costing b) Prepare a variable costing income statement for each year. c) For each year explain why the operating income is or is not different using absorption costing compared to using variable costing. In your answer show by how much the operating income differs in each year

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