P7-3B

P7-3B. Variable And Absorption Costing-Service Company Rocky's Automotive specializes in per- forming automobile safety checks. After the company's first year of operations, its accountant pre- pared the following summarized data report for the safety checks for 2016: Production costs (7,010 safety checks): Shop overhead: . . . . 112,160 Fixed Operating expenses: Fixed Required a. Prepare an income statement based on full absorption costing b. Prepare an income statement based on variable costing. c. Assume that you must decide quickly whether to accept a special one-time order for 20 safety checks on local police cars for $80 per safety check. Determine the apparent profit or loss on the special order based solely on these data