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Question 7: Giants Inc. sells helmets for $140 each. For 2017, the variable manufacturing costs were $55 per

helmet and total fixed overhead cost was $300,000. Marketing costs were $17 per unit sold and fixed marketing

costs were $90,000 in total. For 2017, there was no beginning inventories. Current production level is 30,000

units and budgeted production was 30,000 units. Giants Inc. sold 25,000 helmets during the year. In 2018, the

different expenses and budgeted production remained the same while production was 28,000 units and 32,000

helmets were sold. With this information please prepare income statements for 2017 and 2018 using both

variable and absorption costing. Make sure to include how you solved for all numbers.