On January 1 of the current year, Townsend Co. commenced operations. It operated its plants at 100% of capacity during January. The following data summarized the results for January:

	Units
Production	50,000
Sales ($18 per unit)	42,000
Inventory, January 31	8,000
Total Cost or Expense:
Manufacturing costs
variable	575,000
Fixed	80,000
Total	655,000
Selling and administrative expenses:
Variable	$35,000
Fixed	10,500
Total	45,500

(a) Prepare an income statement in accordance with absorption costing.

(b) Prepare an income statement in accordance with variable costing.