The Klocka Company manufacturos trendy, high-quality moderately priced watches. As Klocka's senior financial analyst, you are asked to recommend a method of mentory costing. The CFO wil use your commendation to prepare Klocka's 2017 income statement. The following data are for the year anded December 31, 2017: mm Click the icon to view the data) Assumo standard costs per unit are the same for units in beginning inventory and units produced during the year. Also, mume no prion, spending or officiency variance Any production-volume variance is written off to cost of goods sold in the month in which it occur Requirements 1. Prepare Income statements under variable and absorption costing for the your ended December 31, 2017 2. What is Klocka's operating income as porcentage of revenues under each costing method? 3. Explain the difference in operating income between the two methods. 4. Which conting method would you recommend to the Fo? Why? Absorption costing Choose from any list or enter any number in the input fields and then continue to the next question 1 of 4 i Data Table Jorg If re the CF Beginning inventory, January 1, 2017 Ending inventory, December 31, 2017 2017 sales Selling price (to distributor) Variable manufacturing cost per unit, including direct materials Variable operating (marketing) cost per unit sold Fixed manufacturing costs Denominator-level machine-hours Standard production rate Fixed operating (marketing) costs 91,000 units 36,000 units 281,000 units $24.50 per unit $5.00 per unit $1.50 per unit sold $1,180,000 5,900 40 units per machine-hour $1,110,000 Der Print Done cka Company manufactures trendy, high-quality moderately priced watches. As Klocka's financial analyst, you are asked to recommend a method of inventory costing. The CFO will ur recommendation to prepare Klocka's 2017 income statement. The following data are for ar ended December 31, 2017: Click the icon to view the data.) me standard costs per unit are the same for units in beginning inventory and units produced the year. Also, assume no price, spending, or efficiency variances. Any production-volume ence is written off to cost of goods sold in the month in which it occurs. Absorption costing oose from any list or enter any number in the input fields and then continue to the next question Save for Later ESC FT P ska Company manufactures trendy, high-quality moderately priced watches. As Klocka's nancial analyst, you are asked to recommend a method of inventory costing. The CFO will r recommendation to prepare Klocka's 2017 income statement. The following data are for Tended December 31, 2017: ick the icon to view the data.) e standard costs per unit are the same for units in beginning inventory and units produced the year. Also, assume no price, spending, or efficiency variances. Any production-volume ce is written off to cost of goods sold in the month in which it occurs. oose from any list or enter any number in the input fields and then continue to the next question Save for Later Esc