2. ABC Company manufactures a single type of product and the following information is available :

Selling Price per unit $190 Information for Year 1: Units in Beginning Inventory 0 Units Produced 25,000 Units sold 23,800

Information for Year 2: Units in Beginning Inventory ? Units Produced 20,000 Units sold 21,000

Fixed Cost per month (same for Year 1 and Year 2): Fixed Selling & Admin $80,000 Fixed MOH $180,000

Variable cost per unit (same for Year 1 and Year 2): DM $34 DL $21.75 Variable MOH $13.5 Variable Selling& Admin $10.5

Required: a. Calculate the unit product cost for Year 1 under variable costing system. (3 marks) b. Calculate the unit product cost for for Year 1 under absorption costing system. (3 marks) c. Prepare the Income Statement only for Year 2, using the variable costing system. (8 marks)