Income Statements under Absorption Costing and Variable Costing Fresno Industries Inc. manufactures and sells high-quality camping tents. The company began operations on January 1 and operat During February, the company produced 187,000 units during the month but sold 208,000 units at $520 per unit. The February ma Number of Unit Total Units Cost Cost Manufacturing costs in February 1 beginning inventory: Variable 21,000 $260.00 $5,460,000 Fixed 21,000 33.00 693,000 Total $293.00 $6,153,000 Manufacturing costs in February: Variable Fixed Total 187,000 $260.00 $48,620,000 187,000 38.10 7,124,700 $298.10 $55,744,700 Selling and administrative expenses in February: Variable 208,000 $25.40 $5,283,200 Fixed 208,000 5.00 1,040,000 Total $30.40 $6,323,200 This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and i X Open spreadsheet a. Prepare an income statement according to the absorption costing concept for the month ending February 28. Fresno Industries Inc. For the Month Ended February 28 Sales Cost of goods sold: Beginning inventory Cost of goods manufactured Total cost of goods sold Gross profit Selling and administrative expenses Operating income b. Prepare an income statement according to the variable costing concept for the month ending February 28. Fresno Industries Inc. Variable Costing Income Statement For the Month Ended February 28 Sales Variable cost of goods sold Manufacturing margin Variable selling and administrative expenses Contribution margin Fixed costs: Fixed manufacturing costs Fixed selling and administrative expenses Total fixed costs. Operating income c. What is the reason for the difference in the amount of operating income reported in (a) and (b)? Under the absorption costing method, the fixed manufacturing cost included in the cost of goods sold is matched wi