The fixed overhead budgeted for Ranier Industries at an expected capacity of 500,000 units is $1,500,000. Variable costing is used internally, and the net income is adjusted to an absorption costing net income at year-end. Data collected over the last three years show the following:

Determine the adjustment each year to convert the variable costing income to absorption costing net income. Compute the absorption costing net income for each year.
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Units produced Units sold. Net income-(variable costing) First Year 502,000 496,000 Second Year 498,000 503,000 Third Year 496,000 496,000 000 $521,000$497,000