Denton Company manufactures and sells a single product. Cost data for the product are given:

Variable costs per unit:
Direct materials	$ 5
Direct labor	11
Variable manufacturing overhead	4
Variable selling and administrative	1
Total variable cost per unit	$ 21
Fixed costs per month:
Fixed manufacturing overhead	$ 90,000
Fixed selling and administrative	175,000
Total fixed cost per month	$ 265,000

The product sells for $49 per unit. Production and sales data for July and August, the first two months of operations, follow:

	Units Produced	Units Sold
July	15,000	11,000
August	15,000	19,000

The companys Accounting Department prepared the following absorption costing income statements for July and August:

	July	August
Sales	$ 539,000	$ 931,000
Cost of goods sold	286,000	494,000
Gross margin	253,000	437,000
Selling and administrative expenses	186,000	194,000
Net operating income	$ 67,000	$ 243,000

Required:

1. Determine the unit product cost under:
   1. Absorption costing.
   2. Variable costing.
2. Prepare variable costing income statements for July and August.
3. Reconcile the variable costing and absorption costing net operating incomes.