Required Information [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 $ 300 per unit 110,000 units 113,250 units 3,250 units $ 438,750 243,750 682,500 $ Sales price per unit Units produced this year Units sold this year Units in beginning-year inventory Beginning inventory costs Variable (3,250 units X $135) Fixed (3,250 units X $75) Total Manufacturing costs this year Direct materials Direct labor Overhead costs this year Variable overhead Fixed overhead Selling and administrative costs this year Variable Fixed 42 per unit 66 per unit $3,400,000 $ 7,200,000 $1,400,000 4,000,000 2. Prepare the current-year income statement for the company using absorption costing. 2. Prepare the current-year Income statement for the company using absorption costing. OAK MART COMPANY Absorption Costing Income Statement 33,975,000 682,500 Sales Less: Cost of goods sold Beginning inventory Manufacturing costs this year Direct materials Direct labor Fixed overhead costs Less: Ending inventory Variable overhead costs 4,620,000 7.260,000 7,200,000 3,400,000 23,162,500 10,812,500 Cost of goods sold Gross margin Selling general and administrative expenses Variable selling and administrative expenses Fixed selling and administrative costs $ 1,400,000 4,000,000 Total selling general and administrative expenses Na lame Vince 5,400,000 5419 El Less: Ending inventory Variable overhead costs 0 3,400,000 23,162,500 10,812,500 Cost of goods sold Gross margin Selling general and administrative expenses Variable selling and administrative expenses Fixed selling and administrative costs 1,400,000 4,000,000 Total selling general and administrative expenses Net income (loss) 5,400,000 5,412,500 Net income under variable costing is higher than net income under absorption costing by: Number of units added to(subtracted from) inventory Fixed costs added to(subtracted from) inventory