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

Required Information (The following information applies to the questions displayed below.] Oak Mart, a producer of solid oak tables, reports the following data from its second year of business. 320 per unit 115.eae units 119,000 units 4.ee units $ 529.99 3e8,eae 820,000 $ Sales price per unit Units produced this year Units sold this year Units in beginning-year inventory Beginning inventory costs Variable (4,units x $130) Fixed (4,800 units x $75) Total Manufacturing costs this year Direct materials Direct labor Overhead costs this year Variable overhead Fixed overhead Selling and administrative costs this year Variable Fixed 46 per unit 62 per unit $3,600,000 $7,400,000 $1,300,000 4,400,000 1. Prepare the current-year income statement for the company using variable costing. OAK MART COMPANY Variable Costing Income Statement Less: Variable costs Beginning inventory: Variable costs Manufacturing costs this year Direct materials Direct labor Variable overhead costs Total variable costs available Less: Ending finished goods inventory Variable cost of goods sold Variable selling and administrative expenses Total variable costs Contribution margin Less: Fixed expenses Fixed selling and administrative costs Fixed overhead costs Net income (loss) 2. Prepare the current-year income statement for the company using absorption costing. OAK MART COMPANY Absorption Costing Income Statement Sales Less: Cost of goods sold Beginning inventory Manufacturing costs this year Direct materials Direct labor Variable overhead costs Fixed overhead costs Less: Ending inventory I Cost of goods sold Gross margin Selling general and administrative expenses Fixed selling and administrative costs Variable selling and administrative expenses Net income (loss) Net income under variable costing is higher than net income under absorption costing by: Fixed costs added to subtracted from) inventory