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Required Information

$[$The following information applies to the questions displayed below.$]$

Jorgansen Lighting. Incorporated, manufactures heavy$-$duty street lighting systems for municipalitles. The company uses varlable costing for Internal management reports and absorption costing for external reports to shareholders, creditors. and the government. The company has provided the following data:

The company's fixed manufacturing overhead per unit was constant at $$560$ for all three years.

$2$ Assume In Year $4$ that the company's varlable costing net operating income was $$250,000$ and its absorption costing net operating Income was $$300,000.$

a$.$ Did Inventorles Increase or decrease during Year $4?$

Increase

Decrease

b$.$ How much fixed manufacturing overhead cost was deferred or released from inventory during Yehy?

Fixed manufacturing overhead cost

inventory during Year $4$