The answer for A.1. must include the Operating Income $225,000 (30,000 units)

EX 21-8 Estimated income statements, using absorption and variable costing Obj, 1,2 Prior to the first month of operations ending January 31, Lemke Inc. ecimated the following operating results: The company is evaluating a proposal to manufacture 30,000 units instead of 25.000 units, thus creating an ending imventory of 5,000 units. Manufacturing the additional units will not change sales, unit variable factory overhead costs, total fixed factory owerhead cost, or total selling and at administrative expenses. a. Prepare an estimated income statement, comparing operating results if 25,000 and 30,000 units are manufactured in (1) the absorption costing format and (2) the variable costing format. b. What is the reason for the difference in operating income reported for the two levels of production by the absorption costing income statement