'1] Prepare the income statement under absorption casting approach for the year ended 30th September, 2020. 2] Prepare the income statement under variable casting approach for the year ended 30th September, 2020. 3} Reconcile the difference between the two approaches. Kathmandu manufactures trendy, moderately priced rain-jackets. As Kathmandu's senior financial analyst, you are asked to recommend a method of inventory valuation. The following details are available for the year ended 30 September, 2020. Beginning inventory on 1st October 2019 100,000 units Ending inventory on 30th September 2020 50,000 units Sales made in the year 2020 400,000 units Variable manufacturing cost per unit produced (including materials) $6 per unit Variable operating costs (marketing-related) per unit sold $2 per unit Fixed manufacturing costs - actual $1650,000 Budgeted fixed manufacturing costs per jacket $ 5 per unit Fixed operating (marketing-related) costs $1,100,000 Selling price to the distributor $25 per unit Assume that the standard costs per unit are the same units in beginning inventory and goods produced during the year. There are no variances and note that all under- or over-absorbed overheads are adjusted to the cost of goods sold during the year