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On June 30, 2016, the end of the first month of operations, Tudor Manufacturing Co. prepared the following income statement, based on the variable costing concept:

Tudor Manufacturing Co.

Income Statement - Variable Costing

For the Month Ended June 30, 2016

1	Sales (415,000 units)		$6,950,000.00
2	Variable cost of goods sold:
3	Variable cost of goods manufactured (500,000 units $13 per unit)	$6,500,000.00
4	Less ending inventory (85,000 units $13 per unit)	1,105,000.00
5	Variable cost of goods sold		5,395,000.00
6	Manufacturing margin		$1,555,000.00
7	Variable selling and administrative expenses		79,000.00
8	Contribution margin		$1,476,000.00
9	Fixed costs:
10	Fixed manufacturing costs	$140,000.00
11	Fixed selling and administrative expenses	76,000.00	216,000.00
12	Income from operations		$1,260,000.00

	Required:
A.	Prepare an absorption costing income statement. In your computations, round unit costs to two decimal places and round final answers to the nearest dollar.
B.	Reconcile the variable costing income from operations of $1,260,000 with the absorption costing income from operations determined in (A). Enter all amounts as positive numbers.

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