Answer:
Borques Company
a. Unit inventory cost = $7.27 
b. Ending inventory = 3,900 units
c. Absorption-costing operating income = $73,569
Explanation:
a) Data and Calculations:
Variable costs per unit:
Direct materials      $2.85
Direct labor             $1.92
Variable overhead $1.60  $6.37
Variable selling     $0.90   $7.27
Fixed costs per year:
Fixed overhead                $180,000
Selling and administrative $96,000  $276,000
Selling price per unit = $9
Acceptable per-unit inventory cost:
Variable product cost per unit = $6.37
Total variable production cost = $1,274,000
Fixed production cost =                   180,000
Total production cost =              $1,453,000
Unit inventory cost = $7.27 ($1,453,000/200,000)
b. Ending inventory
Beginning inventory   8,200
Production units = 200,000
Units available       208,200
Sales units =          204,300
Ending inventory       3,900
c. Absorption Costing Operating Income:
Sales Revenue                 $1,838,700 ($9 * 204,300)
Cost of goods sold             1,485,261 ($7.27 * 204,300)
Gross profit                        $353,439
Selling expenses:
Variable ($0.90 * 204,300) 183,870
Fixed                                     96,000
Total selling expenses    $279,870
Operating income             $73,569