Exercise 8-20 Difference in Operating Income under Absorption and Variable Costing (LO 8-1, 8-4) Manta Ray Company manufactures diving masks with a variable cost of $22. The masks sell for $31. Budgeted fixed manufacturing overhead for the most recent year was $809,100. Actual production was equal to planned production. Required: State whether operating income is higher under variable or absorption costing and the amount of the difference in reported operating income under the two methods. Treat each condition as an independent case (Do not round intermediate calculations.) 1. Production 107,880 units Sales 105,580 units 2. Production Sales. 93,000 units 98,300 units 3. Production 79,400 units Sales 79,400 units Answer is not complete. Income Higher Under Amount of (Method) 1 Absorption costing 2 Variable costing 3 Same under both Difference 67,250 00