Income Statements under Absorption Costing and Variable Costing Gallatin County Motors Inc. assembles and sells snowmobile engines. The company began operations on July 1 and operated at 100% of capacity during the first month. The following data summarize the results for July: Sales (16,000 units) Production costs (21,000 units): $2,400,000 Direct materials Direct labor Variable factory overhead Fixed factory overhead $1,165,500 558,600 279,300 186,900 2,190,300 Selling and administrative expenses: Variable selling and administrative expenses $339,500 Fixed selling and administrative expenses 131,400 470,900 If required, round interim per-unit calculations to the nearest cent. a. Prepare an income statement according to the absorption costing concept. Gallatin County Motors Inc. Absorption Costing Income Statement For the Month Ended July 31 Sales Cost of goods sold Gross profit Selling and administrative expenses Operating income 2,400,000