Question-4 Variable and absorption costing, explaining operating-income differences. Nascar Motors assembles and sells motor vehicles and uses standard costing. Actual data relating to April and May 2017 are as follows: Insert Review D May Home Page Layout Formulas Data B 1 April 2 Unit data: 3 Beginning inventory 0 4 Production 500 5 Sales 350 6 Variable costs: 7 Manufacturing cost per unit produced 1$ 10,000 8 Operating (marketing) cost per unit sold 3,000 9 Fixed costs: 10 Manufacturing costs $2,000,000 11 Operating (marketing) costs 600,000 150 400 520 IS 10,000 3,000 $2,000,000 600,000 The selling price per vehicle is $24,000. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 500 units. There are no price, efficiency, or spending variances. Any production-volume variance is written off to cost of goods sold in the month in which it occurs. Required: 1. Prepare April and May 2017 income statements for Nascar Motors under (a) variable costing and (b) absorption costing. 2. Prepare a numerical reconciliation and explanation of the difference between operating income for each month under variable costing and absorption costing