Consider the following information for Company A:

Selling price per unit$ 12.00

Variable manufacturing cost per unit$ 6.50

Variable selling and administrative cost per unit$ 1.25

Fixed selling and administrative expenses per year$ 150,000

Beginning inventory in 20190 units

Production in 2019240,000 units

Sales in 2019233,500 units

Production in 2020200,000 units

Sales in 2020203,000 units

Fixed manufacturing cost per unit in 2019$ 2.00

Required:

1)Assume that selling prices, variable costs per unit, and total fixed costs did not change from 2019 to 2020. Present Company A's Income Statements for 2019 and 2020 using absorption costing.

2)Assume that selling prices, variable costs per unit, and total fixed costs did not change from 2019 to 2020. Present Company A's Income Statements for 2019 and 2020 using variable costing.