(Income statements for two years, both methods) D-Tect manufactures radar detectors. Each unit contains product cost of $20 for direct material, $60 for direct labor, and $20 for variable overhead. The company’s annual fixed cost is $750,000; it uses expected capacity of 25,000 units produced as the basis for applying fixed overhead to products. A commission of 10 percent of sell¬ ing price is paid on each unit sold. Annual fixed selling and administrative expenses are $180,000. The following additional information is available:LO1.

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2006 2007 Selling price per unit $200 $200 Number of units sold 20,000 24,000 Number of units produced 25,000 22,000 Beginning inventory (units) 15,000 20,000 Ending inventory (units) 20,000 ?