The demand for aloe vera hand Iotion, one of numerous products manufactured by Smooth Skin Care Products Inc., has dropped sharply because of recent competition from a similar product. The company's chemists are currently completing tests of various new formulas, and it is anticipated that the manufacture of a superior product can be started on December 1 , orie month in the future. No changes will be needed in the present production facilities to manufacture the new product because only the mixture of the various materials wil be changed. The controller has been asked by the president of the company for advice on whether to continue production during November or to suspend the manufacture of aloe vera hand lotion until December 1 . The controller has assembled the following pertinent data: The production costs and seling and administrative expenses, based on production of 400,000 units in October, are as follows: Sales for November are expected to drop 20% below those of October to 320,000 units (400,00080%). No significant changes are anticipated in the fixed costs or variable costs per unit. No extra costs will be incurred if discontinuing operations in the portion of the plant associated with aloe vers hand lotion. The inventory of aloe vera hand lotion at the beoinning and end of November is expected to be inconsequential. 1. Prepare an estimated income statement in absorption costing form for November for aloe vera hand lotion, assuming that production continues during the month. Smooth Skin Care Products Inc. Estimated Income Statement-Absorption Costing- Aloe Vera Hand Lotion 2. Prepare an estimated income statement in variable costing form for November for aloe vera hand lotion, assuming that production continues during the month. Smooth Skin Care Products Inc. Estimated Income Statement-Variable Costing-Aloe Vera Hand Lotion Eartha Manth Condinn Mawimbon on 3. What would be the estimated operabing loss it the aloe vera hand lotion production were temporanily suspended for November? 4. What advice should the controller give to management? Production of A.V. Iotion should be Temporary suspension of production would refult in an operating loss of compared with an operating loss of if production is continued, The result would be a savings of