Oak Mart, a producer of solid oak tables, reports the following data from its first year of business.

1. Prepare the current year income statement using variable costing.

2. Prepare the current year income statement using absorption costing.

Sales price per unit Units produced this year Units sold this year Variable selling and administrative expenses Fixed selling and administrative expenses Direct materials Direct labor Variable overhead Fixed overhead $320 per unit 117,000 units 117,000 units $12 per unit $4,600,000 per year $40 per unit $62 per unit $28 per unit $7,020,000 per year