Answer:
Instructions are below.
Explanation:
<u>The absorption costing</u> method includes all costs related to production, both fixed and variable. The unit product cost is calculated using direct material, direct labor, and total unitary manufacturing overhead.
<u>The variable costing</u> method incorporates all variable production costs (direct material, direct labor, and variable overhead).
<u>I will assume that there is no beginning nor ending inventory.</u>
<u></u>
<u>Absorption costing income statement:</u>
<u></u>
Sales= 6,100*590= 3,599,000
COGS= (6,100*413)= (2,519,300)
Gross profit= 1,079,700
Total selling expense= (6,100*50 + 125,600)= (430,600)
Total administrative expense= (6,100*28 + 207,500)= (378,300)
Net operating income= 270,800
<u>Variable costing income statement:</u>
Sales= 3,599,000
Total variable cost= 6,100*(413 + 50 + 28)= (2,995,100)
Total contribution margin= 603,900
Total fixed selling expense= (125,600)
Total fixed administrative expense= (207,500)
Net operating income= 270,800