On January $1$ of the current year, Townsend Co$.$ commenced operations. It operated its plant at $100\%$ of capacity during January. The following data summarized the results for January:Line Item DescriptionUnitsProduction$50,000$Sales $($$$18$ per unit$)(42,000)$Inventory$,$ January $318,000$Manufacturing costs:Amount Variable$$575,000$ Fixed$80,000$ Total$$655,000$Selling and administrative expenses:Amount Variable$$35,000$ Fixed$10,500$ Total$$45,500$Question Content Areaa. Prepare an income statement using absorption costing.Townsend Co$.$Absorption Costing Income StatementFor the Month Ended January $31$Line Item DescriptionAmountAmount$$-$ Select $-$Cost of goods sold:$$-$ Select $--$ Select $--$ Select $-$$$-$ Select $--$ Select $-$Operating income$Operating incomeQuestion Content Areab. Prepare an income statement using variable costing.Townsend Co$.$Variable Costing Income StatementFor the Month Ended January $31$Line Item DescriptionAmountAmount$$-$ Select $-$Variable cost of goods sold:$$-$ Select $--$ Select $--$ Select $-$$$-$ Select $--$ Select $-$$$-$ Select $-$Fixed costs:$$-$ Select $--$ Select $-$blankTotal fixed costsTotal fixed costsOperating income$Operating income