The following data were adapted from a recent income statement of Caterpillar Inc. (CAT) for the year ended December 31:

Line Item Description	(in millions)
Sales	$41,748
Cost of goods sold	$(29,082)
Selling, administrative, and other expenses	(8,113)
Total expenses	$(37,195)
Operating income	$4,553

Assume that $10,575 million of cost of goods sold and $5,000 million of selling, administrative, and other expenses were fixed costs. Inventories at the beginning and end of the year were as follows:

Line Item Description	Amount
Beginning inventory	$11,266
Ending inventory	11,402

Also, assume that 30% of the beginning and ending inventories were fixed costs.

Question Content Area

a. Preepare an income statement according to the variable costing concept for Caterpillar Inc. Round numbers to nearest million.