Game Spot manufactures video games that sell for $41 each. The company uses a fixed manufacturing overhead allocation rate of $4 per game. Assume all costs and production levels are exactly as planned. The following daya are from Game Spot's first two months in business:

Requirements 1. Compute the product cost per game produced under absorption costing and under variable costing. 2. Prepare monthly income statements for October and November, including columns for each month and a total column, using these costing methods: a. absorption costing. b. variable costing. 3. Is operating income higher under absorption costing or variable costing in October? In November? Explain the pattern of differences in operating income based on absorption costing versus variable costing. 4. Determine the balance in Finished Goods Inventory on October 31 and November 30 under absorption costing and variable costing. Compare the differences in inventory balances and the differences in operating income. Explain the differences in inventory balances based on absorption costing versus variable costing. Data table Game Spot manufactures video games that it sells for $41 each. The company uses a fixed manufacturing overl exactly as planned. The following data are from Game Spot's first two months in business: I7. (Click the icon to view the data.) Read the requirements. Requirement 1. Compute the product cost per game produced under absorption costing and under variable cos Requirement 2a. Prepare monthly income statements for October and November, including columns for each m es a fixed manufacturing overhead allocation rate of $4 per game. Assume all costs and production levels are usiness: costing and under variable costing. , including columns for each month and a total column, using absorption costing. Game Spot manulactures video games that in sels for $41 each. The company uses a fored manufacturing overhead alocation rate of $4 per game. Assume all costs and production levels are exactly os planned. The following dath are from Game Spots frst two months in business: (Click the ioon to vlow the dala.) Read the requirements Requirement 1. Compute the product cost per game produced under abscrption costing and under vaiable cosbing exacty as plamed. The folowing dath are from Garne Spoft firdt two morthe in business: (Cick the icon to viow the data ). Renad the mouirmments Requirement 1. Compute the protuct cost per game peoduced under absorption costing and under variable costing Game Spot manufactures video games that it sells for $41 each. The company uses a fixed manufacturing overhead all exactly as planned. The following data are from Game Spot's first two months in business: (Click the icon to view the data.) Read the requirements. Requirement 1. Compute the product cost per game produced under absorption costing and under variable costing. Requirement 2a. Prepare monthly income statements for October and November, including columns for each month an uses a fixed manufacturing overhead allocation rate of $4 per game. Assume all costs and production levels are business: n costing and under variable costing. , including columns for each month and a total column, using absorption costing. Data table Requirements 1. Compute the product cost per game produced under absorption costing and under variable costing. 2. Prepare monthly income statements for October and November, including columns for each month and a total column, using these costing methods: a. absorption costing. b. variable costing. 3. Is operating income higher under absorption costing or variable costing in October? In November? Explain the pattern of differences in operating income based on absorption costing versus variable costing. 4. Determine the balance in Finished Goods Inventory on October 31 and November 30 under absorption costing and variable costing. Compare the differences in inventory balances and the differences in operating income. Explain the differences in inventory balances based on absorption costing versus variable costing