Please show all work and explain

1A)

1B)

The company's selling and administrative expenses consist of $307,500 per year in fixed expenses and $5 per unit sold in variable expenses. The $25 unit product cost given above is computed as follows: Redo the company's income statement in the contribution format usina variable costing. Reconcile any difference between the net operating income on your variable costing incame statement and the net operating income on the absorption costing income statement above. (Enter any losses or deductions as a negative value.)