Exercise 7-6 (Algo) Variable and Absorption Costing Unit Product Costs and Income Statements [LO7- 1, LO7-2] 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 $ 11 $ 3 $ 1 $ 1 $ 330,000 $ 240,000 During the year, the company produced 30,000 units and sold 23,000 units. The selling price of the company's product is $43 per unit. Required: 1. Assume that the company uses absorption costing: a. Compute the unit product cost. b. Prepare an income statement for the year. 2. Assume that 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. Req 1A Req 1B Req 2A Req 2B Compute the unit product cost. Assume that the company uses absorption costing. Unit product cost Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Prepare an income statement for the year. Assume that the company uses ab Lynch Company Absorption Costing Income Statement Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Compute the unit product cost. Assume that the company uses variable costing. Unit product cost Prepare an income statement for the year. Assume that the company uses variable Lynch Company Variable Costing Income Statement