Prepare absorption and P6-88 Electricoil is a division of Meier Products Corporation. The division manufactures variable costing income statements and reconcile and sells an electric coil used in a wide variety of applications. During the coming year, it differences between absorption expects to sell 200,000 units for $9 per unit. Mark Barnes is the division manager. He is and variable costing income considering producing either 200,000 or 250,000 units during the period. Other informa- statementts when sales level tion is presented in the schedule. and production level change. Discuss relative usefulness Division Information for 2014 of absorption costing versus Beginning inventory 0 variable costing. Expected sales in units 200,000 (LO 6, 7, 8), AN Selling price per unit $9 Variable manufacturing costs per unit $3 Fixed manufacturing overhead costs (total) $500,000