Required information Exercise 19-7 Income reporting under absorption costing and variable costing LO P2 [The following information applies to the questions displayed below.] Oak Mart, a producer of solid oak tables, reports the following data from its second year of business. Sales price per unit Units produced this year Units sold this year Units in beginning-year inventory Beginning inventory costs Variable (3,500 units x $135) Fixed (3,500 units x $70) 300 per unit 105,000 units 108,500 units 3,500 units 472,500 245,000 717,500 Total Manufacturing costs this year Direct materials 42 per unit 70 per unit Direct labor Overhead costs this year $3,400,000 $7,400,000 Variable overhead Fixed overhead this year tive cos Variable $1,450,000 4,000,000 Fixed Exercise 19-7 Part 1 1. Prepare the current-year income statement for the company using variable costing. OAK MART COMPANY Variable Costing Income Statement Beginning inventory: Manufacturing costs this year Manufacturing costs this year 0 0 Net income (loss) 2. Prepare the current year income statement for the company using absorption costing. OAK MART COMPANY Absorption Costing Income Statement Beginning inventory Manufacturing costs this year Manufacturing costs this year Net income (loss) Fixed costs added to(subtracted from) inventory