Joplin Industries Inc. manufactures and sells high-quality sporting goods equipment under its highly recognizable J-Sports logo. The company began operations on May 1 and operated at 100% of capacity (270,000 units) during the first month, creating an ending inventory of 24,000 units. During June, the company produced 246,000 garments during the month but sold 270,000 units at $300 per unit. The June manufacturing costs and selling and administrative expenses were as follows:

A. Prepare an income statement according to the absorption costing concept for June.
B. Prepare an income statement according to the variable costing concept for June.
C. What is the reason for the difference in the amount of income from operations reported in (A) and (B)?

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Number of Units Unit Cost Total Cost Manufacturing costs in June 1 beginning inventory: 24,000 $150.00 32.80 $182.80 $3,600,000 787,200 s 4,387,200 24,000 Manufacturing costs in June: 246,000 $150.00 36.00 $186.00 $36,900,000 8,856,000 45,756,000 246,000 Sellng and administrative expenses in June 270,000 45.00 3.60 $48.60 12,150,000 972,000 270,000