Glico Wings uses FIFO actual costing system. The value of fixed manufacturing cost rate calculated at the end of the year through dividing the actual fixed manufacturing cost by the actual production units. Glico Wings sold only 1 product type called Matcha Mochi which has a selling price $3/unit. Glico Wings prepares income statement using absorption costing as below: 2021 2022 Revenues (Price @ $3) Cost of goods sold: Beginning inventory Variable manufacturing costs Fixed manufacturing costs Cost of goods available for sale Deduct ending inventory Cost of goods sold Gross margin 3000 3600 400 700 500 700 700 1400 1600 (400) (240) 1000 1360 2000 2240 Operating costs: Variable operating costs 1000 1200 400 Fixed operating costs Total operating costs Operating income 400 1400 1600 600 640 Additional information 2021 2022 Production 1400 unit 1000 unit Required: 1. Prepare income statement based on variable costing for 2021 and 2022 2. Prepare a numerical reconciliation and explanation of the difference between operating income under absorption costing and variable costing.