Exercise 06-3 Income reporting under absorption costing and variable costing LO P2 Sims Company, a manufacturer of tablet computers, began operations on January 1, 2019. Its cost and sales information for this year follows 30 per unit 50 per unit 40 per unit $6,300,000 per year) Manufacturing costs Direct materials Direct labor Overhead costs Variable Fixed Selling and administrative costs for the year Variable Fixed Production and sales for the year Units produced Units sold Sales price per unit $750,000 $5,000,000 105,000 units 75,000 units 360 per unit 1. Prepare an income statement for the year using variable costing Prepare an income statement for the year using variable costing. SIMS COMPANY Variable Costing Income Statement Sales $ 27,000,000 Less: Variable costs Direct materials Direct labor Variable overhead costs Variable selling and administrative expenses $ 2,250,000 3,750,000 750,000 10,500,000 ces Total variable costs Contribution margin Less: Fixed expenses Fixed selling and administrative costs Fixed overhead costs Net income (loss) Required 2 > **** Prepare an income statement for the year using absorption costing. SIMS COMPANY Absorption Costing Income Statement Net income (loss)