29. Which costing method (variable or absorption) will generate a higher net income in Cutterski's first year of operations and by how much? a. Variable by $81,000 b. Variable by $108,000 c. Absorption by $81,000 d. Absorption by $108,000 e. None of the above answers is correct. Use the following information for questions 30 through 32. McCoy Corporation manufactures computer monitors. Shown below is McCoy's cost structure: Manufacturing cost Selling and administrative Variable cost per monitor $75.20 $14.60 Total fixed cost for the year $912,000 $456,000 In its first year of operations, McCoy produced 100,000 monitors but only sold 95,000. McCoy's gross margin in this first year was $2,629,600. McCoy's contribution margin in this first year was $2,109,000. 30. Under the variable costing method, what is McCoy's net income for its first year? a. $266,000 b. $741,000 c. $1,261,600 d. $786,600 e. $2,173,600 31. Under the absorption costing method, what is McCoy's net income for its first year? a. $266,000 b. $741,000 c. $1,261,600 d. $786,600 e. $2,173,600 32. If McCoy produces 100,000 monitors and sells 100,000 monitors in the second year of operations, which of the following statements will be true? (Assume no change in cost structure or selling price.) a. McCoy's variable costing net income in its second year will be greater than its absorption costing net income. b. McCoy's absorption costing unit product cost will decrease in the second year. c. McCoy's gross margin will be equal to its contribution margin in its second year. d. McCoy's variable costing net income in its second year will be equal to its absorption costing net income. e. Both answers (a) and (b) are correct answers