CBA is a division of Flynn, Inc. The division manufactures and sells a pump that is used in a wide variety of applications. During the coming year, it expects to sell 30,000 units for $25 per unit. Raad Ali, division manager, is considering producing either 30,000 or 40,000 units during the period. Other information is presented in the schedule below:

Division Information 2016

Beginning inventory	0
Expected sales in units	30,000
Selling price per unit	$25
Variable manufacturing cost per unit	$7
Fixed manufacturing overhead costs (total)	$480,000
Fixed manufacturing overhead costs per unit	----
Based on 30,000 units ($480,000 30,000)	$16
Based on 40,000 units ($480,000 40,000)	$12
Manufacturing cost per unit	-----
Based on 30,000 units ($7 variable + $16 fixed)	$23

Based on 40,000 units ($7 variable + $12 fixed)	$19
Selling and administrative expenses (all fixed)	$25,000

Instructions

Prepare a variable costing income statement with one column showing the results if 30,000 units are produced and one column showing the results if 40,000 units are produced.