Options***

Begining Inventory

Costs of good manufactured, at standard

ending inventory

Manufacturing Overhead

Production Value Variance

Selling and administrative expenses

Examine the Osborne Company's simplified income statement based on variable costing. Assume that the budgeted volume for absorption costing in 20X0 and 20X1 was 1,440 units and that total fixed costs were identical in 20X0 and 20X1. There is no beginning or ending work in proces (Click the icon to view the simplified income statement.) Requirements 1. Prepare an income statement based on absorption costing. Assume that actual fixed costs were equal to budgeted fixed costs. 2. Explain the difference in operating income between absorption costing and variable costing. Be specific Requirement 1. Prepare an income statement based on absorption costing. Assume that actual fixed costs were equal to budgeted fixed costs. Osborne Company Absorption Costing Income Statement Data Table For the Year Ended December 31, 20X1 -X Sales Income Statement Year Ended December 31, 20X1 $ 14,190 $ 550 Sales, 1,290 units at $11 Deduct variable costs Beginning inventory, 110 units at $5 Variable manufacturing cost of goods manufactured, 1,240 units at $5 Variable manufacturing cost of goods available for sale Ending inventory, 60 units at $5 Variable manufacturing cost of goods sold 6,200 $ 6,750 300 $ 6,450 800 Variable selling and administrative expenses 7,250 Operating income $ 6,940 Total variable costs Contribution margin Deduct fixed costs Fixed factory overhead at budget Fixed selling and administrative expenses Total fixed costs $ 5,040 450 5.490 $ 1,450 Operating income . innuit field and than