Below are numbers from Spectrum Company on a product during the first year of operations. During this first year the company produced 88,000 units and sold 72,000 units at a price of $280 per unit.

Production costs

Direct materials per unit $60

Direct labor per unit $22

Variable overhead per unit $8

Fixed overhead for the year $528,000

Selling and administrative cost

Variable selling and administrative cost per unit $11

Fixed selling and administrative cost per year $105,000

. Determine the unit product cost using absorption costing.

2. Determine the unit product cost using variable costing.

3. Prepare an income statement for the year under absorption costing.

4. Prepare an income statement for the year under variable costing.