The annual data that follows pertain to Sea Down There, a manufacturer of swimming goggles (the company had no beginning inventory): (Click the icon to view the data.) Read the requirements. -X Data Table ... Sea Down There Contribution Margin (Variable Costing) Income Statement For the Year Ended December 31 Sales revenue S 8.786.000 Less: Variable expenses Variable cost of goods sold S 3,438,000 Variable operating expenses 2.292.000 Contribution margin 3.055.000 Less: Fixed expenses Fixed manufacturing overhead 1.640.000 255.000 Fixed operating expenses S 1.161.000 Operating Income Sales price... .$ 46 Variable manufacturing expenso por unit... $ 18 Sales commission expense per unit ...... $ 12 Fixed manufacturing overhead $ 1,540,000 Fixed operating expenses $ 255,000 Number of goggles produced 205,000 Number of goggles sold 191.000 Requirement 2. Which statement shows the higher operating income? Why? Print Done Absorption costing operating income is higher than variable costing operating income. This is because absorption costing defers $ 112,000 of fixed manufacturing overhead as an asset in ending inventory. In contrast, variable costing expenses all of the fixed manufacturing overhead during the year. Variable costing expenses S 112,000 more costs during the year, so variable costing operating income iss less than absorption costing income the year. Help Me Solve This Video Get More Help. Clear All Final Check Final Check