Income statements under absorption costing and variable costing.

come Statements under Absorption Costing and Variable Costing Crazy Mountain Sports Inc. assembles and sells snowmobile engines. The company began operations on March 1 and operated at 100% of capacty during the first month. The following data summarize the results for March: If required, round interim per-unit calculations to the nearest cent. Prepare an income statement according to the absorption costing concept. b. Prepare an income statement according to the variable costing conceot. c. What is the reason for the difference in the amount of operaying income reported in (5) and (b)? Under the method, the fored manufacturing cost induded in the cost of goods sold is matched with the revenves. Under of the fixed manufocturing cost is deducted in the period in which it is incurred, regardless af the amount of inventory change. Thus, when inventory increases, the income statempent wili have a higher ogerating income