Blazer Chemical produces and sells an ice-melting granular used on roadways and sidewalks in winter. It annually produces and sells 45,600 tons of its granular. Because of this year's mild winter, projected demand for its product is only 38,000 tons. Based on projected production and sales of 38,000 tons, the company estimates the following income using absorption costing. Sales (38,000 tons at $132 per ton) $ 5,016,000 Coat of goods sold (38,000 tonn at $99 per ton) 3,762.000 Cross profit 1,254,000 Selling and administrative expenses 1, 254,000 Income $0 Its product cost per ton follows and consists mainly of fixed overhead because its automated production process uses expensive equipment. Direct materials Direct labor Variable overhead Pixed overhead (52,500,000/38,000 tond) $ 15 per ton $ 15 per ton $ 3 per ton 6 66 per ton Selling and administrative expenses consist of variable selling and administrative expenses of $11 per ton and fixed selling and administrative expenses of $836,000 per year. The company's president will not earn a bonus unless a positive income is reported. The controller mentions that because the company has large storage capacity, it can report a positive income by setting production at the usual 45,600 ton level even though it expects to sell only 38,000 tons. The president is surprised that the company can report income by producing more without increasing sales. Required: 1. Prepare an income statement using absorption costing based on production of 45,600 tons and sales of 38.000 tons. Can the company report a positive Income by increasing production to 45,600 tons and storing the 7,600 tons of excess production in Inventory? 2. By how much does income increase by when producing 45,600 tons and storing 7,600 tons in inventory compared to only producing 38,000 tons? Required: 1. Prepare an income statement using absorption costing based on production of 45,600 tons and sales of 38,000 tons. Can the company report a positive income by increasing production to 45,600 tons and storing the 7,600 tons of excess production in Inventory? 2. By how much does income increase by when producing 45,600 tons and storing 7,600 tons in inventory compared to only producing 38,000 tons? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an income statement using absorption costing based on production of 45,600 tons and sales of 38,000 tons. Can the company report a positive income by increasing production to 45,600 tons and storing the 7,600 tons of excess production in Inventory? (Round your answers to the nearest whole dollar) BLAZER CHEMICAL Income Statement (Absorption Costing) Did the company report a positive income? Required: 1. Prepare an income statement using absorption costing based on production of 45,600 tons and sales of 38,000 tons. Can the company report a positive income by increasing production to 45,600 tons and storing the 7,600 tons of excess production in Inventory? 2. By how much does Income increase by when producing 45,600 tons and storing 7,600 tons In inventory compared to only producing 38,000 tons? Complete this question by entering your answers in the tabs below. Required 1 Required 2 By how much does income increase by when producing 45,600 tons and storing 7,600 tons in inventory compared to only producing 38,000 tons? Increase in Income