North Atlantic Corporation produces a single product. The company had no beginning inventory and they produced 70,000 units in 2022 and sold 60,000 units. The operating data for 2022 follow:

Sales$1,380,000

Manufacturing costs:

Direct Materials$294,000

Direct Labor182,000

Variable overhead273,000

Fixed overhead150,500

Selling & Administrative expenses:

Fixed$140,000

Variable258,000

Required:

A). Calculate the value of the ending finished goods inventory under variable costing.(4 Marks)

B). Show an Income Statement using variable costing.(7 Marks)

C). Show an Income Statement using absorption coating(6 Marks)

D). Explain in detail why the net income differs under the two accounting methods.(3 Marks)