Data Concerning Sonderegger Company's Operations Last Year Appear Below Required:
A)Prepare an Income Statement for the Year Using Absorption

Data concerning Sonderegger Company's operations last year appear below:
$\begin{array}{|l|r|}\hline \text { Selling price } & \$ 110 \\\hline \text { Units in beginning inventory } & 0 \\\hline \text { Units produced } & 70,000 \\\hline \text { Units sold } & 60,000 \\\hline \text { Selling price per unit } & \$ 12.00\\\hline \text { Variable costs per unit: } & \\\hline \text { Direct materials } & \$ 2.00 \\\hline \text { Direct labour } & \$ 1.00 \\\hline \text { Variable manufacturing overhead } & \$ 1.00 \\\hline \text { Variable selling and administrative } & \$ 1.50 \\\hline \text { Fixed costs: } & \\\hline \text { Fixed manufacturing overhead } &\$ 140,000 \\\hline\text { Fixed selling and administrative }&\$ 150,000\\\hline\end{array}$


Required:
a)Prepare an income statement for the year using absorption costing.
b)Prepare an income statement for the year using variable costing.
c)Prepare a report reconciling the difference in operating income between absorption and variable costing for the year.