PR 21-1A Absorption and variable costing income statements During the first month of operations ended August 31, Kodiak Fridgeration Company manufactured 90,000 mini refrigerators units, of which 81,000 were sold. Operating data for the month are summarized as follows: Sales 81,000 X $135 10.935,000 Manufacturing costs: (for 90,000 units) Direct materials 6,750,000 Direct labor 1,620,000 Variable manufacturing cost 1,260,000 Fixed manufacturing cost 360,000 9,990,000 Selling and administrative expenses: Variable 1,100,000 Fixed 200,000 1,300,000Instructions 1. Prepare an income statement based on the absorption costing concept. 2. Prepare an income statement based on the variable costing concept. 3. Explain the reason for the difference in the amount of operating income reported in (1) and (2)