Skinny Dippers, Inc. produces nonfat frozen yogurt. The product is sold in five-gallon containers, whichhave the following price and variable costs.Sales price ?????????????????????????????????????. $15Direct material ???????????????????????????????????.. 5Direct labor ?????????????????????????????????????. 2Variable overhead ?????????????????????????????????? 3Budgeted fixed overhead in 20×1, the company?s first year of operations, was $300,000. Planned andactual production was 150,000 five-gallon containers, of which 125,000 were sold. Skinny Dippers, Inc.incurred the following selling and administrative expenses.Fixed ???????????????????????????????? $50,000 for the yearVariable ??????????????????????????????.. $1 per container soldRequired:1. Compute the product cost per container of frozen yogurt under ( a ) variable costing and(b ) absorption c osting.2. Prepare income statements for 20×1 using ( a ) absorption costing and ( b ) variable costing.3. Reconcile the income reported under the two methods by listing the two key places where theincome statements differ.4. Reconcile the income reported under the two methods using the shortcut method. <