Denton Company manufactures and sells a single product. Cost data for the product are given: $ 3 10 Variable costs per unit: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Total variable cost per unit Fixed costs per month: Fixed manufacturing overhead Fixed selling and administrative Total fixed cost per month $ 18 $ 108,000 172,000 $ 280,000 The product sells for $48 per unit. Production and sales data for July and August, the first two months of operations, follow: Units Produced 18,000 18,000 Units Sold 14,000 22,000 July August The company's Accounting Department has prepared the following absorption costing income statements for July and August: Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income July $ 672,000 322,000 350,000 186,000 $ 164,000 August $1,056,000 506,000 550,000 194,000 $ 356,000 Required: 1. Determine the unit product cost under: a. Absorption costing. b. Variable costing. 2. Prepare variable costing income statements for July and August. 3. Reconcile the variable costing and absorption costing net operating incomes