Absorption and Variable Costing Income Statements During the first month of operations ended July 31 , YoSan Inc. manufacture 1. Prepare an income statement based on the absorption costing concept. 2. Prepare an income statement based on the variable costing concept. 3. Explain the reason for the difference in the amount of operating income reported in (1) and (2). The operating income reported under costing exceeds the operating income reported under deferred to a future month under costing, due to costing. manufacturing costs that are