Exercise 8-7 Del Corporation developed the following standard unit costs at normal production capacity, which is...

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Exercise 8-7 Del Corporation developed the following standard unit costs at normal production capacity, which is 100,000 units: Direct materials Direct labor Variable factory overhead Fixed factory overhead Total P5 4 2 22 9 P20 The selling price for each unit of product is P35. Variable commercial expenses are P2 per unit. The selling price and the costs of the product have not changed since the company began operations two years ago. Data related to the operations of the company for the past two years follow: 2019 2020 Units actually produced Units sold 95,000 106,000 90,000 110,000 Fixed commercial expenses P500,000 P550,000 REQUIRED: 1. Prepare a comparative income statement for 2019 and 2020 under the absorption costing method. 2. Prepare a comparative income statement for 2019 and 2020 under the direct costing method. 3. Compute and reconcile the differences in income for the two years under the absorption costing and direct costing methods. Exercise 8-7 Del Corporation developed the following standard unit costs at normal production capacity, which is 100,000 units: Direct materials Direct labor Variable factory overhead Fixed factory overhead Total P5 4 2 22 9 P20 The selling price for each unit of product is P35. Variable commercial expenses are P2 per unit. The selling price and the costs of the product have not changed since the company began operations two years ago. Data related to the operations of the company for the past two years follow: 2019 2020 Units actually produced Units sold 95,000 106,000 90,000 110,000 Fixed commercial expenses P500,000 P550,000 REQUIRED: 1. Prepare a comparative income statement for 2019 and 2020 under the absorption costing method. 2. Prepare a comparative income statement for 2019 and 2020 under the direct costing method. 3. Compute and reconcile the differences in income for the two years under the absorption costing and direct costing methods.