Exercise 06-6 Absorption costing income statement LO P2 Hayek Bikes prepares the income statement under variable costing for its managerial reports, and it prepares the income statement under absorption costing for external reporting. For its first month of operations, 350 bikes were produced and 225 were sold; this left 125 bikes in ending inventory. The income statement information under variable costing follows. Sales (225 * $1,750) Variable product coat (225 x 3675) Variable selling and administrative expenses (225 $55) Contribution margin Fixed overhead cost Pixed selling and administrative expense Net Incone $ 393,750 151.875 12,375 229,500 63,000 90,000 $ 76,500 1. Prepare this company's income statement for its first month of operations under absorption costing. 2. Fill in the blanks: Required 1 Required 2 Prepare an income statement for the current year under absorption costing. KENZI KAYAKING Absorption Costing Income Statement Sales Less: Cost of goods sold Variable product costs Fixed overhead costs Cost of goods sold Gross margin Selling general and administrative expenses Variable selling and administrative expenses Fixed overhead costs Net income (loss) Net income under absorption costing is higher than net income under variable costing by: Fixed costs added to inventory Regulred 1 Required 2 > Check my work 1 Sales (225 x $1,750) Variable product cost (225 x $675) Variable selling and administrative expenses (225 $55) Contribution margin Fixed overhead coat Fixed selling and administrative expense Net Income $ 393,750 151, 075 12,325 229,500 63,000 90.000 $ 76,500 1. Prepare this company's income statement for its first month of operations under absorption costing, 2. Fill in the blanks: Complete this question by entering your answers in the tabs below. Required 1 Required 2 Fill in the blanks: units foxed Overhead per unit. The dollar difference in variable costing income and absorption costing income