Adjusting variable cost income to absorption net income The fixed overhead budgeted for...

Adjusting variable cost income to absorption net income

The fixed overhead budgeted for MacBeth Co. at an expected capacity of 500,000 units is $1,500,000. Variable costing is used internally, and the net income is adjusted to an absorption costing net income at year-end. Data collected over the last three years show the following:

Determine the adjustment each year to convert the variable costing income to absorption costing net income. Compute the absorption costing net income for each year.