Exercise 7-6 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 Pixed selling and administrative $ $ $ $ 14 B 2 2 $250,000 $160,000 During the year, the company produced 25,000 units and sold 21,000 units. The selling price of the company's product is $47 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. Req 1A Reg 1B Req 2A Reg 28 Compute the url product cost. Assume that the company uses absorption costing Unit product cost Req 1A Reg 1B Req 2A Req 2B Prepare an income statement for the year. Assume that the company uses absorption costing. Lynch Company Absorption Costing Income Statement 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. Reg 1A Reg 1B Req 2A Reg 2B Compute the unit product cost. Assume that the company uses variable costing. Unit product cost Req 1A Reg 1B Req 2A Req 2B Prepare an income statement for the year. Assume that the company uses variable costing. Lynch Company Variable Costing Income Statement