Jorgansen Lighting, Inc., manufactures heavy-duty street lighting systems for municipalities. The company uses variable costing for internal management reports and absorption costing for external reports to shareholders, creditors, and the government. The company has provided the following data:     Year 1 Year 2 Year 3 Inventories       Beginning (units) 220 170 190 Ending (units) 170 190 220 Variable costing net operating income $290,000 $279,000 $250,000     The company’s fixed manufacturing overhead per unit was constant at $400 for all three years.   Required: 1. Calculate each year’s absorption costing net operating income. (Enter any losses or deductions as a negative value.)       Reconciliation of Variable Costing and Absorption Costing Net Operating Incomes   Year 1 Year 2 Year 3 Variable costing net operating income       Add (deduct) fixed manufacturing overhead deferred in (released from) inventory under absorption costing       Absorption costing net operating income

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Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.