Ice Age Company, sells ice skates for $$40$ per pair and has the following data:

Production Costs

Direct materials $$4$ per unit

Direct labor $$8$ per unit

Overhead cost

Variable overhead cost $$180,000$

Fixed overhead cost $600,000$

Total overhead cost $$780,000$

Expected units produced $60,000$ units

Non$-$Production Costs

Variable selling and administrative expenses $$2$ per unit

Fixed selling and administrative expenses $$200,000$ per year

Year Units Produced Units Sold Units in Ending Inventory

$201960,00060,0000$

$202060,00040,00020,000$

$202160,00080,0000$

Required:

Prepare the company$$s income statement for each year using both absorption and

variable costing.