Variable Costing Income Statement: On July 31, the end of the first month of operations, Rhys Company prepared the following income statement, based on the absorption costing concept: a. Prepare a variable costing income statement, assuming that the fixed manufacturing costs were $40,000 and the variable seling and administrative expenses were $2.8;000. In your computations, round unit costs to two decimal places and round final answers to the nearest dollar. b. Reconcile the absorption costing income from operations of $434,000 wah the variable cesting inceme fram operatiens determined in (a). Reconciliation of Absorption and Variable Costing Income