On January 1 of the current year, Townsend Co. commenced operations. It operated its plant at 100% of capacity during January. The following data summarized the results for January: Units 50,000 Production Sales ($18 per unit) Inventory, January 31 42,000 8,000 Manufacturing costs: Variable Fixed $575,000 80,000 $655,000 Total Selling and administrative expenses: Variable Fixed $35,000 10,500 Total $45,500 a. Prepare an income statement using absorption costing. Townsend Co. Absorption Costing Income Statement For Month Ended January 31, 20-- Cost of goods sold: Income from operations b. Prepare an income statement using variable costing. Townsend Co. Variable Costing Income Statement For Month Ended January 31, 20-- Variable cost of goods sold: Fixed costs: Income from operations