Problem 8.40B: I need step by step solutions with explanations. Question is attached as an image in this discussion box.

P8403 [Additional practice: Not for homework) Calculate the product cost; prepare income statement: under variable costing and absorption costing, and reconcile the a'i'erenoes when sales andproa'uciion levels change. {5 LO 1. g, g. i) Allerdyce Corporation Ltd. (ACL) prepares external nancial statements using absorption costing and internal nancial statements using variable costing. You have the following information for the operations of ACL for the past two years: 2019 2020 Sales in units (@ $35 per unit) 25.000 35.000 Production in units 30,000 30,000 Variable production costs per unit 3 20 $ 20 Fixed production costs 120.000 120.000 Fixed marketing costs 50.000 50.000 Beginning inventory 0 Instructions a Prepare absorption-costing income statements for the years ended December 31. 2019, and 2020. Include a column for totals for the two years. Total N] = $560,000 b. Prepare variable-costing income statements for the years ended December 31, 2019, and 2020. Include a column for totals for the two years. Total NI = $560,000 c. Reconcile the year-to-year differences in net income under the absorption-costing and variable- costing methods