Sparn Limited incurs the following costs to produce and sell a single product Variable costs per unit: Direct saterials Direct labour Variable manufacturing overhead Variable selling and administrative expenses Fixed costs per year Fixed manufacturing overhead Fixed selling and administrative expenses 14 4 175,200 518,700 During the last year, 43,800 units were produced and 27,300 units were sold. The Finished Goods Inventory account at the end of the year shows a balance of $220,000 for the 5,500 unsold units Required: 1-a. Is the company using absorption costing or variable costing to cost units in the Finished Goods Inventory account? O Absorption costing O Variable costing 1-b. Show computations to support your answer Direct materials Direct labour Variable manufacturing overhead Fixed manufacturing overhead Unit product cost Total cost 5.500 units Variable Absorption Costing Costing