Oak Mart, a producer of solid oak tables, reports the following data from its second year of business.

Sales price per unit $ 310 per unit

Units produced this year 110,000 units

Units sold this year 113,250 units

Units in beginning-year inventory 3,250 units

Beginning inventory costs:

Variable (3,250 units $135) $ 438,750

Fixed (3,250 units $75) 243,750

Total $ 682,500

Manufacturing costs this year

Direct materials $ 48 per unit Direct labor $ 68 per unit

Overhead costs this year:

Variable overhead $ 3,200,000

Fixed overhead $ 7,200,000

Selling and administrative costs this year:

Variable $ 1,350,000

Fixed 4,200,000

1. Prepare the current-year income statement for the company using variable costing.

2. Prepare the current-year income statement for the company using absorption costing.