Richardson Corporation plans to increase its advertising budget by 20% next year. The company currently spends $15,000 on advertising costs. In addition to advertising, Richardson spends $50,000 per year for other fixed costs and $10 per unit for variable costs. If Richardson anticipates producing 30,000 units next year, what will be next year's total costs?

*already calculated total costs which is $368,000. Need question #2 answered below.*

Preferred Products has the following cost information available for 2012:

Direct materials	$4.00 per unit
Direct labor	$3.00 per unit
Variable manufacturing overhead	$2.00 per unit
Variable selling and administrative costs	$1.00 per unit
Fixed manufacturing overhead	$25,000
Fixed selling and administrative costs	$10,000

During 2012, Preferred produced 5,000 units out of which 4,600 units were sold for $30 each.

2. Calculate Preferred's net operating income assuming the company uses a variable costing method as well as an absorption costing method.