1) The ABC Company located in Toronto, Ontario, is projected to make 50,000 units and sell 40,000 units. The selling price will be $12 per unit. The variable manufacturing costs are $4 per unit. Annual fixed manufacturing overhead is $180,000. Variable selling and administrative costs are $2 per unit sold, and fixed selling and administrative costs are $20,000. The company will have no beginning inventory. Prepare a variable-costing income statement and absorption-costing income statement. Explain why there is a difference between the two income statements.