Question 4 AFN Company produces plastic that is used for injection-moulding applications such as gears for small motors. In 2020, the first year of operations, AFN Company produced 4,200 tonnes of plastic and sold 2,772 tonnes. In 2021, the production and sales results were exactly reversed. In each year, the selling price per tonne was $2,200; variable manufacturing costs were 14% of the sales price for the units produced; variable selling expenses were 11% of the selling price of the units sold; fixed manufacturing costs were $2,772,000; and fixed administrative expenses were $525,000. Prepare comparative income statements for each year using variable costing. (Use the format from Illustration 8.5.) AFN COMPANY Income Statement-Variable Costing For the Years Ended December 31 A 2020 2021 Number of units manufactured 4200 2772 Number of units sold 2772 4200 Sales 6098400 9240000 Less Variable costs Inventory, beginning 439824 Add Costs of goods manufactured 12936001 853776 Cost of goods available for sale 1293600 1293600 Less Inventory, ending 439824 Variable cost of goods sold 853776 1293600 Variable selling and administrative costs 670824 1016400