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PR 20-3A Absorption and variable costing income statements for two months oBJ. 1, 2 and analysis During the first month of operations ended March 31, 2016, Hip and Conscious Clothing Company produced 55,500 designer cowboy hats, of which 51,450 were sold. Operating data for the month are summarized as follows: 1. b. Income from operations, $38,205 $771,750 ME HOW $471,75o 127,650 61,050 55,500 Direct labor Fixed manufacturing cost 15,950 Selling and administrative expenses: 36,015 25,725 61,740 During April, Hip and Conscious Clothing produced 47,400 designer cowboy hats and sold 51,450 cowboy hats. Operating data or April are summarized as follows: 5771,750 Manufacturing costs: ...$402,900 Direct labor... 52,140 55,500 Fixed manufacturing cost. 619,560 Selling and administrative expenses: Fixed 25,725 61,740 1. Using the absorption costing concept, prepare income statements for (a) March and 2. Using the variable costing concept, prepare income statements for (a) March and . a.Explain the reason for the differences in the amount of income from b. Explain the reason for the differences in the amount of income from 4.Based on your answers to (1) and (2), did Hip and Conscious Clothing Cb April. (b) April. operations in1) and (2) for March. operations in (1) and (2) for April. Cornpany onerate more profitably in March or in April? Explain

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