Dowell Company produces a single product. Its income statements under absorption costing for its first two years of operation follow.

Income Statements (Absorption Costing)	Year 1	Year 2
Sales ($63 per unit)	$ 2,268,000	$ 4,284,000
Cost of goods sold ($51 per unit)	1,836,000	3,468,000
Gross profit	432,000	816,000
Selling and administrative expenses	298,000	394,000
Income	$ 134,000	$ 422,000

Additional Information

1. Sales and production data for these first two years follow.

Units	Year 1	Year 2
Units produced	52,000	52,000
Units sold	36,000	68,000

2. Variable costs per unit and fixed costs per year are unchanged during these years. The company's $51 per unit product cost using absorption costing consists of the following.

Direct materials	$ 15
Direct labor	22
Variable overhead	4
Fixed overhead ($520,000/52,000 units)	10
Total product cost per unit	$ 51

3. Selling and administrative expenses consist of the following.

Selling and Administrative Expenses	Year 1	Year 2
Variable selling and administrative ($3 per unit sold)	$ 108,000	$ 204,000
Fixed selling and administrative	190,000	190,000
Total	$ 298,000	$ 394,000

Required: Prepare income statements for each of these two years under variable costing. (Loss amounts should be entered with a minus sign.)