Problem: Soccer nets for commercial use sell for $200.00 each. Selected data for the company's operations for the last year follow:
Units in beginning inventory 0
Units produced 500
Units sold 300
Units ending inventory 200
Variable costs per unit
Direct materials $75
Labor 30
Variable manufacture overhead 10
Selling and administrative 5
Fixed costs
Fixed manufacturing overhead $2000
Selling and administrative $100
Problem 1: Assume that the company uses variable costing, compute the net operating income. (Please show all work).
Problem 2: Assume that the company uses the absorption costing, compute the net operating income. (Show all work).