Cool Sky reports the following for its first year of operations. The company produced 40,000 units and sold 32,000 units at a price of $130 per unit. Direct materials Direct labor Variable overhead Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses $ 54 per unit $ 20 per unit $6 per unit $.440,000 per year $ 9 per unit $ 195,000 per year Exercise 6-3 (Algo) Part 1a 1a. Assume the company uses absorption costing. Determine its total product cost per unit. Answer is complete and correct. Per unit product cost using: Absorption costing Direct materials per unit $ 54 Direct labor per unit 20 Variable overhead per unit 6 Fixed overhead per unit 11 OOO OOOO Total product cost per unit 91 1b. Assume the company uses absorption costing. Prepare its income statement for the year under absorption costing. Answer is complete but not entirely correct. Income Statement (Absorption Costing) Sales $ 4.160,000 Cost of goods sold 2,912,000 Gross profit 1,248,000 Selling and administrative expenses 352,000 Income $ 896,000 2a. Assume the company uses variable costing. Determine its total product cost per unit. Answer is complete and correct. Per unit product cost using: Variable costing $ 54 Direct materials per unit Direct labor per unit Variable overhead per unit 20 6 Total product cost per unit 80 2b. Assume the company uses variable costing. Prepare its income statement for the year under variable costing. Answer is not complete. Income Statement (Variable Costing) Sales Less: Variable expenses Fixed overhead costs X Variable selling and administrative expenses Variable overhead costs Gross profit Income