ES Dowell Company produces a single product. Its income statements under absorption costing for its rst two years of operation follow. Income Statements (Absorption Costing) Year 1 Year 2 Sales ($46 per unit) $ 920.000 $ 1,840,000 Cost of goods sold ($31 per unit) 620,000 1,240,000 Gross profit 300,000 600,000 Selling and administrative expenses 170,000 220,000 Income $ 130.000 $ 380.000 Additional Information a. Sales and production data for these rst two years follow. Units Year 1 Year 2 Units produced 30,000 30,000 Units sold 20,000 40,000 b. Variable costs per unit and fixed costs per year are unchanged during these years. The company's $31 per unit product cost using absorption costing consists of the following. Direct materials $ 5 Direct labor 9 Variable overhead 7 Fixed overhead ($300,000/30,000 units) 10 Total product cost per unit $ 31 c. Selling and administrative expenses consist of the following. 35 c. Selling and administrative expenses consist of the following. Selling and Administrative Expenses Year 1 Year 2 Variable selling and administrative ($2.50 per unit sold) $ 50,000 $ 100,000 Fixed selling and administrative 120,000 120,000 Total $ 170,000 $ 220.000 Required: Prepare income statements for each of these two years under variable costing. (Loss amounts should be entered with a minus sign.) ess: Variable expenses Variable cost of goods sold - - Variable selling and administrative expenses - - __ __ __ __ Income (Loss)