a. Prepare an income statement under the absorption costing approach.

b. Preprare an income statement under the variable costing approach.

2. The Ontario Co. produces and sells a single product. The following data refer to the year just completed: Beginning inventory.. Units produced. Units sold. 0 10,000 8,000 $350 $40 $220,000 Selling price per unit........ Selling and administrative expenses: Variable per unit Fixed (total). Manufacturing costs: Direct materials cost per unit. Direct labor (variable) cost per unit. Variable manufacturing overhead cost per unit. Fixed manufacturing overhead (total)...... $150 $60 $10 $400,000