Aces Incorporated, a manufacturer of tennis rackets, began operations this year. The company produced 6,000 rackets and sold 4,900. Each racket was sold at a price of $90. Fixed overhead costs are $78,000 per year, and fixed selling and administrative costs are $65,200 per year. The company also reports the following per unit variable costs for the year.

Direct materials	$ 12
Direct labor	8
Variable overhead	5
Variable selling and administrative expenses	2

Prepare an income statement under variable costing.

ACES INCORPORATED
Income Statement (Variable Costing)