can you please solve exercise 8-4 a,b and c and show me the steps with explanations.

this is how the question is EXERCISE 8-4

Evaluating Absorption and Variable Costing as Alternative Costing Methods[LO4]

The following questions involve the same manufacturing company in two different sets of circumstances. In both, the cost structure of the company is constant from year to year. Selling prices, unit variable costs, and total fixed costs are the same in every year. However, unit sales and/or unit production levels may vary from year to year.

Required:

2. Consider the following data for scenario A:

Variable costing operating income

Year 1 $16,847

Year 2 $16,847

Year 3$16,847

Absorption costing operating income

Year 1 $16,847

Year 2 $29,378

Year 3 $6,018

1. Were unit sales constant from year to year? Explain.
2. What was the relationship between unit sales and unit production levels in each year? For each year, indicate whether inventories grew or shrank.
3. Page 316

Consider the following data for scenario B:

]

Variable costing operating income (loss)

Year 1 $16,847

Year 2 $(18,153)

Year 3 $(53,153)

Absorption costing operating income

Year 1 $16,847

Year 2 $17,583

Year 3 $18,318

1. Were unit sales constant from year to year? Explain.
2. What was the relationship between unit sales and unit production levels in each year? For each year, indicate whether inventories grew or shrank.
3. Given the patterns of operating income in scenarios A and B above, which costing method, variable costing or absorption costing, do you believe provides a better reflection of economic reality? Explain.

thank you