During the first month of operations ended August 31, Kodiak Fridgeration Company manufactured 50,000 mini refrigerators, of which 44,000 were sold. Operating data for the month are summarized as follows: 1 Sales $9,240,000.00 2 Manufacturing costs: 3 Direct materials $3,500,000.00 4 Direct labor 1,200,000.00 5 Variable manufacturing cost 850,000.00 6 Fixed manufacturing cost 600,000.00 6,150,000.00 7 Selling and administrative expenses: 8 Variable $572,000.00 9 Fixed 352,000.00 924,000.00 Required: 1. Prepare an income statement based on the absorption costing concept.* 2. Prepare an income statement based on the variable costing concept.* 3. Explain the reason for the difference in the amount of operating income reported in (1) and (2). * Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon () will automatically appear if it is required. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. 1. Prepare an income statement based on the absorption costing concept. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon () will automatically appear if it is required. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Kodiak Fridgeration Company Absorption Costing Income Statement For the Month Ended August 31 1 Sales $9,240,000.00 2 Selling and administrative expenses: 3 Variable cost of goods manufactured $572,000.00 4 Fixed manufacturing costs 352,000.00 5 Selling and administrative expenses 924,000.00 6 Cost of goods manufactured $5,412,000.00 7 Gross profit 3,828,000.00 8 Operating income $2,904,000.00 2. Prepare an income statement based on the variable costing concept. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon :) will automatically appear if it is required. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Kodiak Fridgeration Company Variable Costing Income Statement For the Month Ended August 31 1 Sales $9,240,000.00 2 Variable cost of goods sold: 3 $3,080,000.00 4 1,056,000.00 5 6 7 8 9 (Label) 5 6 7 8 9 (Label) 10 11 12 13 Final Question 3. Explain the reason for the difference in the amount of operating income reported in (1) and (2). costing, due The Operating income reported under absorption costing exceeds the Operating income reported under variable to fixed manufacturing costs that are deferred to a future month under absorption costing