LTE Income Statements under Absorption Costing and Variable Costing Gallatin County Motors Inc. assembles and sells snowmobile engines. The company began operations on July 1 and operated at 100% of capacity during the first month. The following data summarize the results for July: Sales (9,500 units) Production costs (12,000 units): $1,425,000 Direct materials Direct labor Variable factory overhead Fixed factory overhead $666,000 319,200 159,600 106,800 1,251,600 Selling and administrative expenses: Variable selling and administrative expenses $194,000 Fixed selling and administrative expenses 75,100 269,100