Yale Company manufactures hair brushes that sell at wholesale for $3 per unit. The company had no beginning inventory in the prior year. These data summarize the current and prior year operations:

	Prior Year			Current Year
Sales		3,500	units		7,300	units
Production		5,400	units		5,400	units
Production cost
Factoryvariable (per unit)	$	0.60		$	0.60
fixed	$	2,700		$	2,700
Marketingvariable	$	0.40		$	0.40
Administrativefixed	$	500		$	500

Required: 1. Prepare an income statement for each year based on full costing. 2. Prepare an income statement for each year based on variable costing. 3. Prepare a reconciliation of the difference each year in the operating income resulting from using the full costing method and variable costing method.

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