Variable costing income statement Erie Corporation makes microwave ovens which it sells directly to several large department stores. The current year's selling price is $145 per unit. During the current year, the company made 57,000 units of product and sold 61,000 units. Normal capacity is 55,000 units per year. Below are cost data for the year.

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Manufacturing costs: Direct materials and purchased components $3,705,000 Direct labor 684,000 Variable MOH 342,000 Budgeted and actual fixed manufacturing overhead..... 1,650,000 Operating expenses: Variable selling and administrative 488,000 Fixed selling and administrative... 800,000 Finished goods inventory at the beginning of the year was 9,000 units at a cost of $115. Fixed overhead was $35 of the total unit cost.