15) Maddie's Mats produces and sells artistic placemats for dining room tables. These placemats are manufactured out of recycled plastics. For last year, each mat had a variable manufacturing cost of $3, and fixed manufacturing overhead of $150,000. Maddie's Mats incurs no other costs. The following table summarizes the selling price and the number of mats produced and sold last year:

Maddie's Mats uses FIFO (First-in First Out) to value its ending inventory. Last year Maddie's Mats had no beginning inventory.

Required:

a. Prepare an income statement for last year using absorption costing.

b. Prepare an income statement for last year using variable costing.

Below is a similar example problem. i need help breaking the above problem down in a similar format please.

EXAMPLE:

\begin{tabular}{lr} Selling price & Last Year \\ Variable manufacturing cost & $5.00 \\ Fixed manufacturing cost & $150,000 \\ Units produced & 150,000 \\ Units sold & 100,000 \end{tabular} Zeflax manufactures insulated plastic bottles for bikes that the company sells for $4.00 per bottle. Last year, the company produced 230,000 bottles and sold 200,000 bottles. This year, Zeflax produced 200,000 bottles and sold 230,000 bottles. In both years, Zeflax's fixed manufacturing cost was $500,000 and its variable manufacturing cost was $1.00 per bottle. The president of Zeflax commented, "I don't understand these crazy financial statements. Our prices and costs didn't change, we sell more bottles this year, and we show lower income. Something has got to be wrong." Required: a. Prepare income statements for Zeflax for last year and this year using absorption costing. Assume that Zeflax's only costs are the fixed and variable manufacturing costs given in the problem. b. Prepare income statements for Zeflax for last year and this year using variable costing. Assume that Zeflax's only costs are the fixed and variable manufacturing costs given in the problem. c. Explain to the president of Zeflax in nontechnical terms why the financial statements prepared by the accountant in part (a) are not in error. In other words, explain to the president why net income fell this year from last year even though Zeflax sold more bottles. P(06) a) Last Year This Year Sales $800,000 $920,000 (200,0004) (230,000$4) Cogs variable: 200,000(200,0001)200,000(200,0001) Fixed: Prod. this year 434,783 ($500,000230,000) 200,000 500,000 ($500,000200,000) 200,000 95,217 ($1+($500,000230,000 30,000 795,217 $124,783 Net Income $165.217 $124,783 Inventory 95.217 ($1+(500,000230,000)) 30,000 b) Last Year This Year Sales. $800,000 $920,000 Co6s: Variable Fixed Total cobs 200,000 230,000 700,000500,000 730,000500,000 Net Income $100,000 $190,000