D 7 S LO 1 2 Variable costs per unit: Direct materials Direct labour Variable MOH Variable selling & admin Fixed costs per year: Fixed MOH Fixed selling & admin $ 10 SS S2 S4 $ 180,000 $ 300,000 Inventory started the year at zero units, 30,000 unit were produced and the inventory at the end of the year was 5,000 units 1. Which costing method would have a higher net operating income for year 1? 2. By how much will the two net operating incomes differ? 3. What caused this difference? 4. Assume the net operating income with the absorption method is $450,000 what would the net operating income with the variable costing system be? 5. What is the product cost per unit used in the variable costing method? MC Question 1 Question 2 Question 3 Question 4 Question Our