Ch 06 Ex 6-4 Saved Help Sa 1 Exercise 06-4 Variable costing income statement LO P2 8 points Kenzi Kayaking, a manufacturer of kayaks, began operations this year. During this first year, the company produced 1,025 kayaks and sold 775 at a price of $1,025 each. At this first year-end, the company reported the following income statement information using absorption costing. eBook Sales (775 * $1,025) Cost of goods sold (775 * $450) Gross margin Selling and administrative expenses Net income $ 794,375 348,750 445,625 240,000 $ 205,625 101 Hint Additional Information Ask a. Product cost per kayak totals $450, which consists of $350 in variable production cost and $100 in fixed production costthe latter amount is based on $102,500 of fixed production costs allocated to the 1,025 kayaks produced. b. The $240,000 in selling and administrative expense consists of $85,000 that is variable and $155,000 that is fixed. Print References Required: 1. Prepare an income statement for the current year under variable costing. 2. Fill in the blanks: Required 1 Required 2 Prepare an income statement for the current year under variable costing. KENZI KAYAKING Variable Costing Income Statement Sales $ 794,375 Less: Variable costs Variable product costs Variable selling and administrative expenses $ 271,250 271,250 Total variable costs Contribution margin Less: Fixed expenses $ 102,500 Fixed overhead costs Fixed selling and administrative costs Total fixed expenses Net income (loss) 102,500 180,625 $ Net income under absorption costing is higher than net income under variable costing by: $ 25,000 Number of units added to(subtracted from) inventory 250 $ Fixed overhead cost per unit Fixed costs added to inventory 100 25,000 $ Required 1 Required 2 > Required: 1. Prepare an income statement for the current year under variable costing. 2. Fill in the blanks: Complete this question by entering your answers in the tabs below. Required 1 Required 2 Fill in the blanks: The dollar difference in variable costing income and absorption costing income = units fixed overhead per unit.