inn l (Supplemental Problem #1)-Prepare income statements under variable costing (contribution mat) and absorption costing (tradinional forma) margin Costner Company uses an absorption costing eted data are for thing system in accounting for the single product it manufactures The following accounting for Sales (10,000 units) Direct materials used in production (variable cost) Direct labor costs (varable cost) Variable manufucturing overhcad Fixed manuficturing overhead Variable seling and administrative expenses Fixed selling and administrative expenses S 360,000 S 129,600 S 43,200 s 12,960 s 17,280 s 21,600 s 72,000 variable costs. One unit of .08 The company produced U direct material goes into each unit of finished goods. Overhead rates are based on a volume of 12,000 units and are $1 and $1.-44 per unit for variable and fixed overhead, respectively. The ending inventory is the 2,000 units of finished goods on hand at the end of 2013. There was no inventory at the beginning of 2013. 12,000 units and sold 10,000 units. Direct materials and direct labor are Hint: You must compute the cost of production per nit (12,000 units were produced) in order to compute the cost of ending inventory (2,000 units remain in ending inventory at the end of the period. Units in Finished Goods Inventory Beginning 0,OU0 -Sold +Produced Ending equired: Prepare an income statement for 2013 under variable costing. (Template has been provided on the next page). Prepare and income statement for 2013 under absorption costing. (Template has been provided on the next page). Explain the reason for the difference in net income between a and b. (Answer to part C bolded below). gnduolusclu.g Coas. Traditional FOH