For the coming year, Archway Computers Inc. expects to produce and sell 200,000 computers. Of these, 80,000 will be consumer (personal) computers and 120,000 will be small business computers. Common fixed overhead is $700,000. Additional information for the coming year is as follows:

Fixed selling and administrative expense for Archway Computers Inc. is $3,460,000 per year.
Required:
1. Calculate the unit variable cost under variable costing. Is this cost the same as unit variable product cost? Why or why not?
2. Prepare a segmented variable-costing income statement for next year. The segments correspond to product lines: consumer computers and small business computers.

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Small Business Computer Consumer Computer $ 2,300 1,800 290 $ 780 Price Unit direct materials Unit direct labour Unit variable overhead Unit variable selling expense Total direct fixed overhead 500 160 40 75 120,000 75 200,000