The financial data for the Winsor Corporation are shown below: klo4 19X8 19X9 Sales (in units) Selling

The financial data for the Winsor Corporation are shown below: klo4

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19X8 19X9 Sales (in units) Selling price (per unit) Beginning inventory (units) Ending inventory (units) Production (units) 125,000 95,000 $2.00 $2.00 15,000 10,000 10,000 15,000 120,000 100,000 Direct materials (per unit) $.10 $.05 Direct labor (per unit) $.10 $.05 Variable factory overhead (per unit) $.10 $.05 Fixed factory overhead (per unit) $.20 $.10 Fixed selling and administrative expenses (total) $5,000 $3,000 Assume there was no under- or overapplied factory overhead. Required: a Using the direct costing method, prepare an income statement for 19X9. b Using the absorption costing method, prepare an income statement for 1988. C What is the effect on retained earnings in 19X8 if direct costing is used instead of absorption costing?