High Country, Inc. produces and sells many recreational products. The company has just opened a new plant to produce a folding camp cot marketed throughout the United States. The following cost and revenue data related to May, the first month of the plants operation:

Beginning inventory		0
Units produced		35,000
Units sold		30,000
Selling price per unit	$	79
Selling and administrative expenses:
Variable per unit	$	3
Fixed (per month)	$	559,000
Manufacturing costs:
Direct materials cost per unit	$	15
Direct labor cost per unit	$	6
Variable manufacturing overhead cost per unit	$	4
Fixed manufacturing overhead cost (per month)	$	665,000

Management is anxious to assess the new camp cot's profitability during May.

Required:

1. Assume that the company uses absorption costing.

a. Determine the unit product cost.

b. Prepare an income statement for May.

2. Assume that the company uses variable costing.

a. Determine the unit product cost.

b. Prepare a contribution format income statement for May.