During the first month of operations ended September 30, 2012, Sungsam Inc. manufactured 3,200 flat panel televisions, of which 3,000 were sold. Operating data for the month are summarized as follows:

1. Prepare an income statement based on the absorption costing concept.
2. Prepare an income statement based on the variable costing concept.
3. Explain the reason for the difference in the amount of income from operations reported in (1) and (2).

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Sales Manufacturing costs: Direct materials. Direct labor Variable manufacturing cost Fixed manufacturing cost Selling and administrative expenses: $4,275,000 $1,680,000 720,000 272,000 3,177,600 505,600 $ 408,000 195,000 Variable Fixed 603,000