Kenzi Kayaking, a manufacturer of kayaks, began operations this year. During this first year, the company produced 1025 kayaks and sold 775 at a price of $1.025 each. At this first year-end, the company reported the following income statement information using absorption costing. $ Sales (775 * $1,625) Cost of goods sold (775 x $450) Gross margin Selling and administrative expenses Net income 794,375 348,750 445,625 228,888 225, 625 $ Additional Information o. Product cost per kayak totals $450, which consists of $350 in variable production cost and $100 in fixed production cost-the latter amount is based on $102.500 of fixed production costs allocated to the 1.025 kayaks produced. b. The $220,000 in selling and administrative expense consists of $85.000 that is variable and $135,000 that is fixed. Required: 1. Prepare an income statement for the current year under variable costing. 2. Fill in the blanks: Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare an income statement for the current year under variable costing. KENZI KAYAKING Variable Costing Income Statement Sales S 794,375 Less: Variable costs Variable product costs Variable selling and administrative expenses S 271,250 95,000 368,250 428,125 Total variable costs Contribution margin Less: Fixed expenses Fixed overhead costs Fixed selling and administrative costs S 102,500 155,000 257.500 515,000 Total fooed expenses Net income (loss) Net income under absorption costing is higher than net income under variable costing by: Fixed costs added to inventory Complete this question by entering your answers in the tabs below. Required 1 Required 2 Fill in the blanks: The dollar difference in variable costing income and absorption costing income = units fixed overhead per unit