4. Direct costing Income statement. The Prakash Company is comparing its present absorption costing practices with direct costing methods. An examination of its records produced the follow- ing information: Maximum plant capacity.... Normal capacity.. Fixed marketing and administrative expenses.. 20,000 Standard variable manufacturing cost per unit..... 36,000 $54,000 10 Variable marketing expense per unit sold........ For the year, the following data are available: Actual productio 30,000 Finished goods inventory, January Unfavorable variances from standard variable manufactur- 1,000 All variances are written off directly at year-end as an adjustment to Cost of Goods Sold. Required: (1) Direct costing income statement (2) Operating income if absorption costing had been used. (CGAA adapted)