Baker Company began operations in 2013. The company manufacturers a professional-grade vacuum cleaner and can make up to 25,000 units each year. Actual data for 2013 are given as follows: | (Click the icon to view the actual data for 2013.) Read the requirements. Units produced Units sold Selling price Variable costs: Manufacturing cost per unit produced Direct materials Direct manufacturing labor Manufacturing overhead Marketing cost per unit sold Fixed costs: Manufacturing costs Administrative costs Marketing 25,000 15,500 $ 416 30 25 56 47 1,400,000 1,066,000 1,311,200 1. Prepare a 2013 income statement for Baker Company using variable costing. 2. Prepare a 2013 income statement for Baker Company using absorption costing. 3. Explain the differences in operating incomes obtained in requirement 1 and requirement 2. 4. Baker's management is considering implementing a bonus for the supervisors based on gross margin under absorption costing. What incentives will this create for the supervisors? What modifications could Baker management make to improve such a plan? Explain briefly