Variable Costing Income Statement On July 31, 2016, the end of the first month of operations, Rhys Company prepared the following income statement, based on the absorption costing concept: Sales (96,000 units) $4,440,000 Cost of goods sold: Cost of goods manufactured $3,120,000 Less ending inventory (24,000 units) 624,000 Cost of goods sold 2,496,000 Gross profit $1,944,000 Selling and administrative expenses 288,000 Income from operations $1,656,000 a. Prepare a variable costing income statement, assuming that the fixed manufacturing costs were $132,0000 and the variable selling and administrative expenses were $115,200. In your computations, round unit costs to two decimal places and round final answers to the nearest dollar. Rhys Company Income Statement-Variable Costing For the Month Ended July 31, 2016 Sales $4,440,000 Variable cost of goods sold: Variable cost of goods manufactured Less ending inventory Fixed costs: Income from operations b. Reconcile the absorption costing income from operations of $1,656,000 with the variable costing income from operations determined in (a) Reconciliation of Absorption and Variable Costing Income Absorption costing income from operations Variable costing income from operations Difference