Answer:
net income under absorption costing = $44,600
Explanation:
given data
net operating income last year = $71,000
net operating income this year = $85,100
fixed manufacturing overhead costs last year = $26,400
fixed manufacturing overhead costs this year = $9,900
to find out
absorption costing net operating income last year
solution
we find here income under absorption costing that is
as we know that net income under variable costing = $71,000
so Fixed overhead deferred in ending inventory is 0
and Fixed overhead released in beginning inventory is = $26,400
so here net income under absorption costing is
net income under absorption costing = net income under variable costing - Fixed overhead released in beginning inventory
net income under absorption costing = $71,000 - $26,400
net income under absorption costing = $44,600
