$10.$ Erin Mikell Company was concerned that increased sales did not result in increased profits for $2018.$ Both variable unit and total fixed manufacturing costs for $2017$ and $2018$ remained constant at $$20$ and $$2,000,000,$ respectively.

In $2017,$ the company produced $100,000$ units and sold $80,000$ units at a price of $$50$ per unit. There was no beginning inventory in $2017.$ In $2018,$ the company made $70,000$ units and sold $90,000$ units at a price of $$50.$ Selling and administrative expenses were all fixed at $$100,000$ each year.

Required $(10$ points$)$:

a$.$ Prepare income statements for each year using absorption costing.

b$.$ Prepare income statements for each year using variable costing.

c$.$ Explain why the income was different each year using the two methods. Support your explanation with computations.