Lynch Company manufactures and sells a single product. The following costs were incurred during the companys first year of operations:

Variable costs per unit:
Manufacturing:
Direct materials	$ 10
Direct labor	$ 5
Variable manufacturing overhead	$ 1
Variable selling and administrative	$ 1
Fixed costs per year:
Fixed manufacturing overhead	$ 385,000
Fixed selling and administrative	$ 295,000

During the year, the company produced 35,000 units and sold 17,000 units. The selling price of the companys product is $58 per unit.

Required:

1. Assume the company uses absorption costing:
   1. Compute the unit product cost.
   2. Prepare an income statement for the year.
2. Assume the company uses variable costing:
   1. Compute the unit product cost.
   2. Prepare an income statement for the year.