2016 Required a. Prepare gross profit computations for 2015 and 2016 using absorption costing b. Prepare gross profit computations for 2015 and 2016 using variable costing C. Explain how your answers illustrate the impact of differences between production PROB P7-1B sales vol. Variable and Absorption Costing Summarized data for 2016 (the first year of c Gorman Products, Inc., are as follows: umes on the gross profits reported each year under absorption and variable costin P7-2A. . . $3,000,000 Sales (75,000 units) Production costs (80,000 units): 880,000 Direct material Direct labor Manufacturing overhead: Variable Fixed 544,000 .. . .320,000 Operating expenses 168,000 240,000 60,000 18,000 28,800 30,000 Variable Fixed Depreciation on equipment Real estate taxes Personal property taxes (on inventory and equipment) Personnel department expenses P7-2B. Required a. Prepare an income statement based on full absorption costing b. Prepare an income statement based on variable costing c. Assume that you must decide quickly whether to accept a special one-time order for l ,000 units for $30 per unit. Which income statement presents the most relevant data? Determine the appod ent profit or loss on the special order based solely on these data. If the ending inventory is destroyed by fire, which costing approach would you use asa filing an insurance claim for the fire loss? Why? d. for Lo2 P7.3A. Variable and Absorption Costing-Service Company Jensen's Tailoring provides custom services. After the company's first year of operations, its owner prepared the following su data report for 2016: SERVICE AND tailoring