Please show step on how to find answers for question below. Thank you. Ques

Please show step on how to find answers for question below. Thank you.

Question #1

Consider the following information:

Q1

Q2

Q3

Beginning inventory (units)

0

300

300

Actual units produced

1000

800

1250

Budgeted units to be produced

1000

1000

1000

Units sold

700

800

1500

Manufacturing costs per unit produced

$900

$900

$900

Marketing costs per unit sold

$600

$600

$600

Fixed manufacturing costs

$400000

$400000

$400000

Fixed marketing costs

$140000

$140000

$140000

Selling price per unit

$2500

$2500

$2500

There are no price efficiency or spending variances and any production-volume variance is directly written off to cost of goods in the
quarter in which it occurs.

a) Prepare income statements for Q1 Q2 and Q3 using variable costing and absorption costing.

b) Explain the differences in operating income between the two costing systems for each quarter. Be specific!