Ida Sidha Karya Company is a family-owned company located on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $870. Selected data for the company’s operations last year follow: Units in beginning inventory 0 Units produced 260 Units sold 230 Units in ending inventory 30 Variable costs per unit: Direct materials $ 105 Direct labor $ 325 Variable manufacturing overhead $ 45 Variable selling and administrative $ 15 Fixed costs: Fixed manufacturing overhead $ 65,000 Fixed selling and administrative $ 21,000 The absorption costing income statement prepared by the company’s accountant for last year appears below: Sales $ 200,100 Cost of goods sold 166,750 Gross margin 33,350 Selling and administrative expense 24,450 Net operating income $ 8,900 Required: 1. Under absorption costing, how much fixed manufacturing overhead cost is included in the company's inventory at the end of last year? 2. Prepare an income statement for last year using variable costing. What is the amount of the difference in net operating income between the two costing methods?