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

Sales price per unit	$	320	per unit
Units produced this year		105,000	units
Units sold this year		108,500	units
Units in beginning-year inventory		3,500	units
Beginning inventory costs
Variable (3,500 units $135)	$	472,500
Fixed (3,500 units $75)		262,500
Total	$	735,000
Manufacturing costs this year
Direct materials	$	48	per unit
Direct labor	$	60	per unit
Overhead costs this year
Variable overhead	$	3,600,000
Fixed overhead	$	7,200,000
Selling and administrative costs this year
Variable	$	1,450,000
Fixed		4,400,000

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.