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

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 ($50 per unit) $ 1,350,000 $ 2,550,000
Cost of goods sold ($39 per unit)1,053,0001,989,000
Gross profit 297,000561,000
Selling and administrative expenses 247,000271,000
Income $ 50,000 $ 290,000
Additional Information
Sales and production data for these first two years follow.
Units Year 1 Year 2
Units produced 39,00039,000
Units sold 27,00051,000
Variable costs per unit and fixed costs per year are unchanged during these years. The company's $39 per unit product cost using absorption costing consists of the following.
Direct materials $ 16
Direct labor 9
Variable overhead 5
Fixed overhead ($351,000/39,000 units)9
Total product cost per unit $ 39
Selling and administrative expenses consist of the following.
Selling and Administrative Expenses Year 1 Year 2
Variable selling and administrative ($1 per unit sold) $ 27,000 $ 51,000
Fixed selling and administrative 220,000220,000
Total $ 247,000 $ 271,000
Required:
Prepare income statements for each of these two years under variable costing. (Loss amounts should be entered with a minus sign.)

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