Exercise 19-7 Income reporting under absorption costing and variable costing LO P2 [The following information applies to the questions displayed below.] Oak Mart, a producer of solid oak tables, reports the following data from its second year of business. $ Sales price per unit Units produced this year Units sold this year Units in beginning-year inventory Beginning inventory costs Variable (4,000 units * $135) Fixed (4,000 units * $75) 330 per unit 105,000 units 109,000 units 4,000 units $ 540,000 300,000 $ 840,000 A 44 per unit 64 per unit A Total Manufacturing costs this year Direct materials Direct labor Overhead costs this year Variable overhead Fixed overhead Selling and adminstrative costs this year Variable Fixed $3,400,000 $ 7,600,000 $ 1,350,000 4,200,000 Exercise 19-7 Part 1 1. Prepare the current year income statement for the company using variable costing. OAK MART COMPANY Variable Costing Income Statement Beginning inventory: Manufacturing costs this year Net income (loss) Exercise 19-7 Part 2 2. Prepare the current year income statement for the company using absorption costing. OAK MART COMPANY Absorption Costing Income Statement Beginning inventory Manufacturing costs this year Net income (loss) Fixed costs added to(subtracted from) inventory