Exercise $6-6($Algo$)$ Variable and Absorption Costing Unit Product Costs and Income Statements $[$L$06-1,$ L$06-2]$

Lynch Company manufactures and sells a single product. The following costs were incurred during the company's first year of operations:

Variable costs per unit:

Manufacturing:

Direct materials

Direct labor

Variable manufacturing overhead

Variable selling and administrative

Fixed costs per year:

Fixed manufacturing overhead

Fixed selling and administrative

$$340,000$

$$250,000$

During the year, the company produced $34,000$ units and sold $16,000$ units. The selling price of the company's product is $$54$ per unit.

Required:

Assume the company uses absorption costing:

a$.$ Compute the unit product cost.

b$.$ Prepare an income statement for the year.

Assume the company uses variable costing:

a$.$ Compute the unit product cost.

b$.$ Prepare an income statement for the year.

Complete this question by entering your answers In the tabs below.

Required $1$B

Required $2$B

Compute the unit product cost. Assume the company uses absorption costing.

Unit product cost