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, 400 bikes were produced and 240 were sold. Income statement information under variable costing follows. Sales (240 x $1,725) Variable cost of goods sold (240 x $625) Variable selling and administrative expenses (240 x $60) Contribution margin Fixed overhead Fixed selling and administrative expenses Income Prepare the company's income statement under absorption costing. $ 414,000 150,000 14,400 249,600 64,000 80,000 $ 105,600 HAYEK BIKES Income Statement (Absorption Costing)