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		$ 7
Variable manufacturing overhead		$ 3
Variable selling and administrative		$ 3
Fixed costs per year:
Fixed manufacturing overhead	$ 380,000
Fixed selling and administrative	$ 290,000

During the year, the company produced 38,000 units and sold 18,000 units. The selling price of the companys product is $61 per unit.

QUESTIONS ARE BELOW THAT NEED TO BE ANSWERED.

Required: 1. Assume that the company uses absorption costing a. Compute the unit product cost Unit product cost b. Prepare an income statement for the year Lynch Company Absorption Costing Income Statement 0 0 2. Assume that the company uses variable costing a. Compute the unit product cost. Unit product cost