Variable and Absorption Costing Summarized data for 2016 (the first year of operations) for Gorman Products, Inc., are as follows: Sales (75,000 units) $3,000,000 Production costs (80,000 units) Direct material 880,000 Direct labor 720,000 Manufacturing overhead: Variable 544,000 Fixed 320,000 Operating expenses: Variable 168,000 Fixed 240,000 Depreciation on equipment 60,000 Real estate taxes 18,000 Personal property taxes (inventory & equipment) 28,800 Personnel department expenses 30,000 Prepare an income statement based on fut absorption costing Only use a negative with your answer for net income (loss of the answer represents a netfoss Otherwise, do not use negative is with any answers. Round answers to the nearest whole number, when applicable Alsorption Costing Income Statement $ 1.000.000 Cost of Good Solt Beginvertory De materia Decor Manuscrivered Less Ending intory Cot of Goods Sol Gre prote Orerating senses Net income tossi 0 RODO 72.000 4 000 113.00 1.702.500 0.000 408.000 54500 0 b. Prepare an income statement based on variable costing Only a negative sign with your answer for net income fossi theawer represents a net loss. Otherwise, do not use negatie signs with any awer Round rowers to the rest whole number, when aplicable Variable Coming income statement 1.000.000 Van God Bewery Demo DOO Derect 72.000 Variable manufacturing overtid 12.000 Login 104.000 ve cost of goods sold 10.000 Virat operating pemes Contribution margin TA000 Feed Manufacturing 320,000 Operating peres 340.000 560.000 Talled out ence 20,000 0 . c. Assume that you must decide quickly whether to accept a special one-time order for 1,000 units for $30 per unit. Which income statement presents the most relevant data? variable costing Determine the apparent profit or loss on the special order based solely on these data. Use a negative sign with your answer if the special order creates an apparent loss. Round answer to the nearest whole number. $ 960 d. If the ending inventory is destroyed by fire, which costing approach would you use as a basis for filing an insurance claim for the fire loss? Why Select the most appropriate statement Absorption costing approach because the cost should include a reasonable portion of fixed manufacturing costs. Variable costing approach because the cost should include a reasonable portion of fixed manufacturing costs