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Problem 1: Bellue Inc. manufactures a single product. Variable costing net operating income was $77,000 last year and its inventory decreased by 2,700 units. Fixed manufacturing overhead cost was $1 per unit for both units in beginning and in ending inventory. What was the absorption costing net operating income last year?
Multiple Choice Option 1: $2,700
Option 2: $74,300
Option 3: $77,000
Option 4: $79,700
Compute all required amounts and explain how the computations were performed. Evaluate the results for each option and explain what the results mean
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