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Year 1 Year 2 Year 3 Inventories Beginning (units) Ending (units) Variable costing net operating income 210 170 $300,000 170 200 $269,000 200 230 $26

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Year 1 Year 2 Year 3 Inventories Beginning (units) Ending (units) Variable costing net operating income 210 170 $300,000 170 200 $269,000 200 230 $26 , The company's fixed manufacturing overhead per unit was constant at $550 for all three years. 2. Assume in Year 4 that the company's variable costing net operating income was $260,000 and its absorptic income was $270,000. a. Did inventories increase or decrease during Year 4? Increase Decrease b. How much fixed manufacturing overhead cost was deferred or released from inventory during Year 4? Fixed manufacturing overhead cost released from Inventory during Year 4 $ 60,000

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