Requirements 1. Compute the product cost per meal produced under absorption costing and under variable costing. Do this first for January and then for February. 2. Prepare separate monthly income statements for January and for February, using the following: a. Absorption costing b. Variable costing. 3. Is operating income higher under absorption costing or variable costing in January? In February? Explain the pattern of differences in operating income based on absorption costing versus variable costing. Data table Owen's Fooos produces frozen meals, which it sells for $8 each. The company uses the FiFO inventory conting method, and it compules a new monthily fixed manutacturing ovortbad rate based on the achual number of meals produced that month. Al costs and production levels are exactly as planned. The following data are from the company's fist two months in business: (Cick the loon to vew the dista) Read the teguitements Requirement 1. Compute the product cost per meal produced under absorption costing and under variable costing. Do this first for darnuary and then for Fobruary. Raequirement za. Propare separate monthly income atatemecit for January and for February, using absorotion cotEng Requirement 26. Prepace Owen's Foods' January and February income stalements using variable costing Owed's Foode Owen's Foods produces frozen meals, which it sells for $8 each. The company uses the FIFO inventory cokting method, and it computes a new monttly fuxod manulacturing overhead rate based on the actual number of meals produced that month. All costs and production levels are exacty as planned. The following data are from the companys fist two months in business. (Click the icon to view the data.) Read the regurements Requirement 2b. Prepare Owen's Foods' January and February income statements using variable coting. Requirement 3. is cperating income higher under absorption costing or variable costing in January? in Fobruary? Fxplain the patteen of differences in cperating income based on abaorption costing versus variable costing In January, absorpson cosing operatng income varioble costing income. This is because unts produced were units sold versus variable costing In January, absarpbon costing operatng income variable costing income. This is becacise unils produced were. units sold Absorpsion costing defers worre of costs in the units of ending invectary, These costs will not be unt those units are sold Deterinat these cosis to the future January's absorption costing income. In Februayy, absorption costing coerating income variable costing operating incoms. This is because units produced were units sold for the month As inventory as was the case in this February, January's posts that absorption costng aissignod to that invertory are expensed in This February's absorption costing income