Mateo has the following information related to its manufacturing operations in the first two years of operations:

Year 1 Year 2

Production units 110,000 125,000

Sales price per unit $ 32.00 $ 32.00

Units sold 100,000 127,000

Direct Materials per unit $ 8.00 $ 8.00

Direct Labor per unit $ 5.00 $ 5.00

Variable Manufacturing OH per unit $ 4.00 $ 4.00

Fixed Manufacturing OH costs $330,000 $330,000

Variable selling costs per unit $ 6.00 $ 6.00

Fixed selling costs $120,000 $120,000

There was no beginning inventory in Year 1.

a. Prepare Income Statements for each year (Year 1 and Year 2) based on Full Costing (round intermediate calculations to two decimals).