Topple Company produces a single product. Operating data for thecompany and its

Topple Company produces a single product. Operating data for thecompany and its absorption costing income statement for the lastyear are presented below:Units in beginning inventory 2000Units produced 9000Units sold 10000Sales $100000Less cost of goods sold:Beginning inventory 12000Add cost of goods manufactured 54000Goods available for sale 66000Less ending inventory 6000Cost of goods sold 60000Gross margin 40000Less selling and admin. expenses 28000Net operating income $12000Variable manufacturing costs are $4 per unit. Fixed factoryoverhead totals $18000 for the year. This overhead was applied ata rate of $2 per unit. Variable selling and administrative expenseswere $1 per unit sold.Required: Prepare a new income statement for the year usingvariable costing. Comment on the differences between the absorptioncosting and the variable costing income statements.