Reese's Tot Toy Boxes uses variable costing to manage its internal operations. The following data relate to the company's first year of operation, when 25,000 units were produced and 21,000 units were sold. Variable costs per unit Direct material $50 Direct Labor 30 Variable overhead 14 Variable selling costs 12 Fixed costs Selling and administrative $750,000 Manufacturing 500,000 How much higher (or lower) would the company's first-year net income have been if absorption costing had been used rather than variable costing? Show computations.