Kenzi, a manufacturer of kayaks, began operations this year. During this year, the company produced 1,075 kayaks and sold 825 at a price of $1,075 each. At year-end, the company reported the following income statement Information using absorption costing. Sales (825 * $1,075) Cost of goods sold (825 * $450) Gross profit Selling and administrative expenses $ 886,875 371,250 515,625 230,000 $ 285,625 Income Additional Information a. Product cost per kayak under absorption costing totals $450, which consists of $350 in direct materials, direct labor, and variable overhead costs and $100 in fixed overhead cost. Fixed overhead of $100 per unit is based on $107,500 of fixed overhead per year divided by 1,075 kayaks produced. b. The $230,000 in selling and administrative expenses consists of $85,000 that is variable and $145,000 that is fixed. Prepare an Income statement for the current year under variable costing. Answer is not complete. KENZI Income Statement (Variable Costing) Sales S 886,875 Less: Variable expenses Variable cost of goods sold Variable selling and administrative expenses s 288,750 105,000 % 393,750 493,125 Contribution margin Less: Variable expenses Fixed overhead Fixed selling and administrative expenses 107,500 135,000 % 242,500 Income