3. (TCO E) Duif Company's absorption costing income statement for the last year of operations is presented below. Sales.........................................................$70,000 Less cost of goods sold: Beginning inventory.............................................. 0 Add cost of goods manufactured..................48,000 Goods available for sale...............................48,000 Less ending inventory....................................6,000 Cost of goods sold......................................42,000 Gross margin..............................................28,000 Less selling and admin. expenses.................25,000 Net operating income................................$ 3,000 Data on units produced and sold for the year are given below. Units in beginning inventory...................................0 Units produced..............................................8,000 Units sold......................................................7,000 Fixed factory overhead totaled $16,000 for the year. This overhead was applied to products at a rate of $2 per unit. Variable selling and administrative expenses were $3 per unit sold. Required: Prepare a new income statement for the year using variable costing. Comment on the differences between the absorption costing and the variable costing income statements