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Gibson Company incurred manufacturing overhead cost for the year as follows. The company produced 1,900 units and sold 1,400 of them at $181.30 per unit.

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Gibson Company incurred manufacturing overhead cost for the year as follows. The company produced 1,900 units and sold 1,400 of them at $181.30 per unit. Assume that the production manager paid a 1 percent bonus based on the company's net income. Required a. Prepare an income statement using absorption costing. b. Prepare an income statement using variable costing. c. Determine the manager's bonus using each approach. Which approach would you recommend for internal reporting

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