EZ-Seat, Inc., manufactures two types of reclining chairs, Standard and Ergo Ergo provides support for the body through a complex set of sensors and requires great care in manufacturing to the material and frame. Standard is a conventional recliner, uses standard materials, and is simpler to manufacture. EZ-Seat's results for the last fiscal year are shown in the statement helow EZ-SEAT, INC. Ere Statemen $2.000,000 Total Standard $5,000,000 Sales revenue $7,000,000 2,100,000 900,000 1 Direct materials 600,000 400,000 S0,000 500,000 Overhead costs Administration 630.000 up Quality control 285 000 693,000 Distribution $1.927.000 Operating profit EZ-Seat currently uses labor costs to allocate all overhead, but management is considering implementing an activity-based costing system. After interviewing the sales and production staff, management decides to allocate administrative costs on the basis of direct labor costs but to use the following bases to allocate the remaining costs: Activity Level Ergo Standard - Activity Base Cost Driver Seung up 100 Number of production runs 190 quality control Number of units shipped Distribution 1.600 6,100 Required: Complete the income statement using the preceding activity bases. (Do not round intermediate calculations.) Account Total Ergo Standard 5,000,000 S 7,000,000 1,500,000 S Sales revenue 2,000,000 Direct materials 600,000 2,100,000 Direct labor 400,000 500,000 900,000 Overhead costs: Administration 630,000 Production setup 465.000 Quality control 285,000 Distribution 693.000 Total overhead costs 2,073.000 1.000.000 $ 3,000,000 S Operating profit (loss) 1.927.000 s the only overhead allocation base. (Do not round intermediate calculations.) c. Restate the income statement for EZ-Seat using direct labor costs Account Ergo Standard Total Sales revenue 5,000,000 $ 7,000,000 $ 2,000,000 Direct materials 600.000 1,500,000 2.100.000 Direct labor Overhead coss 400,000 500,000 900,000 ting profit (loss) 3,000,000 $ 4,000,000 1,000,000