Final answer:
Option B. Variable costing net operating income is found by subtracting both fixed and variable costs from sales revenue and is a concept in Business related to cost accounting. However, without specific figures for sales, we cannot determine the net operating income for the provided scenario.
Step-by-step explanation:
To determine the variable costing net operating income for year 1 and year 2, we need to look at the calculation and the components involved in variable costing. Variable costing includes all variable costs, which in the case of 'The Clip Joint' barber shop, would be the costs of hiring barbers at $80 per barber each day. To calculate the net operating income using variable costing, you would typically subtract the fixed and variable costs from sales revenue.
Total costs consist of fixed costs and variable costs. Fixed costs remain constant regardless of the level of production, such as the $160 per day cost for space and equipment of the barbershop. Variable costs, on the other hand, vary with the level of output, calculated by multiplying the amount of labor hired by the cost per barber.
The contribution margin is found by subtracting variable costs from sales revenue. To find the net operating income, you would then subtract the fixed costs from the contribution margin. However, without the actual sales revenue figures, it is not possible to provide the net operating income values for year 1 and year 2.