Kenzi, a manufacturer of kayaks, began operations this year. During this year, the company produced 1,050 kayaks and sold 800 at a price of $1,100 each. At year-end, the company reported the following income statement information using absorption costing.

Sales (800 $1,100)	$ 880,000
Cost of goods sold (800 $500)	400,000
Gross profit	480,000
Selling and administrative expenses	230,000
Income	$ 250,000

Additional Information a. Product cost per kayak under absorption costing totals $500, which consists of $400 in direct materials, direct labor, and variable overhead costs and $100 in fixed overhead cost. Fixed overhead of $100 per unit is based on $105,000 of fixed overhead per year divided by 1,050 kayaks produced. b. The $230,000 in selling and administrative expenses consists of $75,000 that is variable and $155,000 that is fixed. Prepare an income statement for the current year under variable costing.