Actual costs were the same as the budgeted costs. Required: 1. Prepare operating income statements for Chataqua Can Company for its first three years of operations using: a. Absorption costing. b. Variable costing. 2. Reconcile Chataqua Can Company's operating income reported under absorption and variable costing for each of its first three years of operation. Use the shortcut method. 3. Suppose that during Chataqua's fourth year of operation actual production equals planned production, actual costs are as expected, and the company ends the year with no inventory on hand. a. What will be the difference between absorption-costing income and variable-costing income in year 4? b. What will be the relationship between total operating income for the four-year period as reported under absorption and variable costing? Complete this question by entering your answers in the tabs below. Req 1A Req 18 Req 2 Req 3A Req 3B Prepare operating income statements for Chataqua Can Company for its first three years of operations using absorption costing. Year 1 Year 2 Year 3 $ 0 $ 0 $ Selling and Administrative Expenses $ 0 $ 0 $ 0 Req 1A Req 18 > Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2 Req 3A Req 3B. Prepare operating income statements for Chataqua Can Company for its first three years of operations using variable costing. Variable expenses: Year 1 Year 2 Year 3 $ 0 $ 0 $ 0 Fixed expenses: 0 $ 0 $ Req 1A Req 1B Req 2 Req 3A Req 3B Reconcile Chataqua Can Company's operating income reported under absorption and variable c years of operation. Use the shortcut method. Year Difference in fixed Change in inventory (in units) Predetermined fixed overhead rate overhead expensed under absorption and variable costing 1 2 3 < Req 1B Req 3A > Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2 Req 3A Req 3B Suppose that during Chataqua's fourth year of operation actual production equals planned production expected, and the company ends the year with no inventory on hand. What will be the difference betw income and variable-costing income in year 4? Difference in reported income < Req 2 Req 3B > Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2 Req 3A Req 3B Suppose that during Chataqua's fourth year of operation actual production equals planned pr expected, and the company ends the year with no inventory on hand. What will be the relatio income for the four-year period as reported under absorption and variable costing? Total operating income will be higher under variable costing. Total operating income will be higher under absorption costing. Total operating income will be same under absorption and variable costing. < Req 3A Req 3B >