Use the following data to prepare a reconciliation converting variable costing income to absorption costing income like Exhibit 19.12 on Page 746. After showing the reconciliation write a sentence or two about why the reconciling item(s) are in one type of income, but not the other:

Variable Costing income $600,000

Absorption Costing Income $750,000

Fixed Overhead Cost recognized from beginning inventory (15,000 units x $10)

Fixed Cost Deferred in ending inventory (15,000 units x $10)