Score: 0 of 7 pts 8 of 14 (7 complete) HW Score: 38.62%, 38.62 of 100 pts E21-20 (similar to) Question Help In May 2018, RefreshAde produced 14,000 cases of powdered drink mix and sold 17,000 cases, of which 3,000 were produced in April. The total April production was 15,000. The sales price was $28, variable costs were $9 per case ($7 manufacturing and $2 selling and administrative), and total fixed costs were $80,000 ($56,000 manufacturing and $24,000 selling and administrative). RefreshAde's May income statement using variable costing follows: (Click the icon to view the variable costing income statement.) Read the requirements. Reference Requirement 1. Prepare the May income statement using absorption costing. RefreshAde Income Statement (Absorption Costing) Month Ended May 31, 2018 476,000 RefreshAde Income Statement (Variable Costing) Month Ended May 31, 2018 Net Sales Revenue $ Variable Costs: Variable Manufacturing Overhead $ 119,000 34,000 Variable Selling and Administrative Costs Contribution Margin Fixed Costs: Fixed Manufacturing Overhead 56,000 24,000 Fixed Selling and Administrative Costs Operating Income 153,000 323,000 80,000 243,000 Operating Income Print Done Requirements 1. Prepare the May income statement using absorption costing. 2. Is operating income using absorption costing higher or lower than variable costing income? Explain why. 3. Determine the balance in Finished Goods Inventory as of May 31. Print Done Choose from any list or enter any number in the input fields and then click Check