Income statements under absorption costing and variable costing Instructions Labels and Amount Descriptions Instructions Shawnee Motors Inc. assembles and sells snowmobile engines. The company began operations on August 1 and operat during the first month. The following data summarize the results for August 1 Sales (32,000 units) $8,000,000.00 2 Production costs (41,000 units): 3 Direct materials $3.280.000,00 4 Direct labor 2,255,000.00 5 Variable factory overhead 1.025,000.00 6 Fixed factory overhead 615,000.00 7.175,000.00 Income statements under absorption costing and variable costing Instructions Labels and Amount Descriptions Instructions $8,000,000.00 1 Sales (32,000 units) 2 Production costs (41,000 units): 3 Direct materials $3,280,000.00 4 Direct labor 2.255,000.00 1.025,000.00 615,000.00 7,175,000.00 5 Variable factory overhead 6 Fixed factory overhead 7 Selling and administrative expenses: Variable selling and administrative expenses 8 $1,180,000.00 9 Fixed selling and administrative expenses 210,000.00 1.390.000,00 Instructions Absorption Costing Income Statement Shawnee Motors Inc. Score: 29/45 Absorption Costing Income Statement For the Month Ended August 31 1 Sales $8,000,000.00 2 Cost of goods sold 3 Gross profit Selling and administrative expenses 5 Income from operations Instructions Absorption Costing Income Statement Variable Costing Income Statement Sha Sha Shawnee Motors Inc. Score: 2/87 Variable Costing Income Statement For the Month Ended August 31 2 3 6 (Label) eBook Show Me How E Print Item Income statements under absorption costing and variable costing Instructions Labels and Amount Descriptions Instructions Absorption Costing Income Statement Variable Costing Income Statement 1 2 3 5 6 (Label) 7 8 10 indu c. What is the reason for the difference in the amount of income from operations reported in (a) and (b)? Check all that apply Under variable costing, all of the fixed factory overhead cost is deducted in the period in which it is incurred, regardless of the amount of Inventory change Under variable costing, the units that were produced but unsold include fixed factory overhead cost, which is not included in cost of goods sold Under absorption costing, when inventory increases the income statement will have a lower income from operations than will the variable costing income statement, There is no difference, the income from operations reported in (a) and (b) is the same, Under absorption costing, when inventory increases the income statement will have a higher income from operations than will the Vanable costing income statement