Please do not give solution in image format thanku During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows:Sales (@$63 per unit)Cost of goods sold (@ $35 per unit)Gross marginSelling and administrative expenses.Net operating incomeDirect materialsDirect labor*$3 per unit variable: $255,000 fixed each year.The company's $35 unit product cost is computed as follows:Year 1$ 1,134,000630,000504,000309,000195,000$Variable manufacturing overheadFixed manufacturing overhead ($368,000+ 23,000 units)Absorption costing unit product costUnits producedUnits soldProduction and cost data for the first two years of operations are:Year 1 Year 223,00023,00018,00028,000Required 3Required 1 Required 2Using variable costing, what is the unit product cost for both years?Unit product costYear 2$ 1,764,000980,000784,000339,000445,000$8Required:1. Using variable costing, what is the unit product cost for both years?2. What is the variable costing net operating income in Year 1 and in Year 2?3. Reconcile the absorption costing and the variable costing net operating income figures for each year.Complete this question by entering your answers in the tabs below.9216$ 35

Variable costing may deliver a different amount for net income than the absorption costing method.…

During Heaton Company's first two years of operations, it reported absorption costing net operating income as follows: Sales (@$63 per unit) Cost of goods sold (@$35 per unit) Gross margin Selling and administrative expenses. Net operating income Direct materials Direct labor riable manufacturing overhead Year 1 $ 1,134,000 630,000 $ *$3 per unit variable: $255,000 fixed each year. The company's $35 unit product cost is computed as follows: Units produced Units sold 504,000 309,000 195,000 $ Fixed manufacturing overhead ($368,000+ 23,000 units) Absorption costing unit product cost Production and cost data for the first two years of operations are: Year 1 Year 2 23,000 23,000 18,000 28,000 Year 2 $ 1,764,000 980,000 784,000 339,000 445,000 $8 9 2 16 $ 35 Required: 1. Using variable costing, what is the unit product cost for both years? 2. What is the variable costing net operating income in Year 1 and in Year 2? 3. Reconcile the absorption costing and the variable costing net operating income figures for each year.