Absorption and variable costing income statements Spaulding Manufacturing Co. has deter...

Absorption and variable costing income statements

Spaulding Manufacturing Co. has determined the cost of manufacturing a unit of product as follows, based on normal production of 100,000 units per year:

Operating statistics for March and April include the following:

The selling price is $20 per unit. There were no inventories on March 1, and there is no work in process on April 30.

Required:

Prepare comparative income statements for each month under each of the following:

1. Absorption costing (include under- or overapplied fixed overhead).

2. Variable costing.