Jones Company, which has only one product, has provided the following data concerning it's most recent month of operation

Jones Company
Income Statement
Sales (2,200 at $68 per unit)						$ 149600
Cost of goods sold:
Beginning Inventory					$ -
Add cost of goods manufactured
(2,400 units at $57 per unit)					136,800
Goods available for sale					136,800
Less ending inventory
(400 units at $48 per unit)					19,200	117,600
Gross margin						32,000
Variable selling and administrative expenses					26,000
Fixed Selling and administrative expenses					24,250	50,250
Operating income						$ (18,250)

The companys selling and administrative expense consist of $24,250 per year in fixed expenses and $10 per unit sold in variable expenses. The companys $57 per unit product cost given above is computed as below:

Direct materials						$ 25
Direct labour						10
Variable manufacturing overhead						7
Fixed manufacturing overhead ($36,000 / 2,400 unit)						15
Unit product cost						$ 57

i) What is the unit product cost for the year under variable costing?

ii) Redo the companys income statement in the contribution format using variable costing.

iii) Reconcile any difference between the operating income on your variable costing income statement and the operating income on the absorption costing income statement above.