Answer:
(First Case) Absorption cost income is higher by 14,200 dollars
(Second Case) variable costing income is higher by 44,000 dollars
(Third Case) they are equal as produciton = sales
Explanation:
the difference arises when production differs with sales.
that's because variable will consider the entire amount of fixed cost as cost of the period while, absorption will capitalizethe fixed cost through inventory. If production matches sales then in both cases the fixed cost are entire expressed in the income statement. If they don't the difference is the difference times unit fixed cost.
(First Case)
fixed cost per unit $792,000 / 110,000 = $7.2
difference (110,000 - 108,000) x $7.2 = $14,200
(Second Case)
fixed cost per unit: 792,000 / 110,000 = $8.8
difference (90,000 - 95,000) x $8.8 = $44,000
(Third Case)
They match thus, no difference arises.
