Can you explain this

1. Absorption costing income statement of a company for the first two years is as follows: Year-1Year-2 Sales 2,000,000 3,000,000 Less cost of goods sold: Beginning inventory 0 340,000 Add cost of goods manufactured 1,700,000 1,700,000 Goods available for sale 1,700,000 2,040,000 Less ending inventory 340,000 Cost of goods sold 1,360,000 2,040,000 Gross margin 640,000 480,000 Less selling and administrative expenses* 620,000 680,000 Net operating income 20,000 280,000 *6 per unit variable; $500,000 fixed each year. The manufacturing cost per unit is computed as follows: Direct materials $16 Direct labor $20 Variable manufacturing $4 overhead Fixed manufacturing overhead $28 $68 Sales and production for two years: Year-1 Year-2 Units produced 25,000 25,000 Units sold 20,000 30,000 Required: a. Prepare a variable costing (contribution margin) income statement. b. Reconcile net operating income figures.2. The following data are available for 2015 from the accounting records of James Corporation. Units in beginning inventory Units produced 65,000 Units in ending inventory 15,000 Selling price per unit $36 Manufacturing costs Direct materials (per unit) $6.00 Direct labor (per unit) $3.6 Variable overhead (per unit) $2.40 Fixed overhead (total) $260,000 Selling and Administrative expenses Variable (per unit) $3.00 Fixed (total) $130,000 Required: a. Compute the following using absorption costing and variable costing (a) unit cost, (b) cost of goods sold, and (c) ending inventory. b. Prepare an income statement using (a) absorption costing, and (b) variable costing3. Brenda Company sells its products for $132 each. The current production level is 25,000 units, although only 20,000 units are anticipated to be sold. Unit manufacturing costs are: Direct materials $24.00 Direct manufacturing labor $36.00 Variable manufacturing costs $18.00 Total fixed manufacturing $360,000 costs Marketing expense $12.00 per unit plus $120,000 per year. Required: a. Prepare an income statement using absorption costing b. Prepare an income statement using variable costing