Income Statements, Variable and Absorption CostingThe following information pertains to Vladamir, Inc., for last year:

Beginning inventory, units 1,300 Units produced 100,000 Units sold 101,000 Variable costs per unit: Direct materials $8.00 Direct labor $9.00 Variable overhead $2.00 Variable selling expenses $2.00 Fixed costs per year: Fixed overhead $200,000 Fixed selling and administrative expenses $230,000 There are no work-in-process inventories. Normal activity is 100,000 units. Expected and actual overhead costs are the same. Costs have not changed from one year to the next.

Required:

1. How many units are in ending inventory?

units

2. Without preparing an income statement, indicate what the difference will be between variable-costing income and absorption-costing income.

$

3a. Assume the selling price per unit is $32. Prepare an income statement using variable costing.

Vladamir, Inc.Variable-Costing Income Statement For Last Year$Less:

Contribution margin$Less:

Operating income$

3b. Assume the selling price per unit is $32. Prepare an income statement using absorption costing.

Vladamir, Inc.Absorption-Costing Income Statement For Last Year$Gross profit$Operating income$